23rd Apr 2018 08:37
LONDON (Alliance News) - Rotork PLC said Monday it expects full-year revenue to grow by mid to high single digits, despite currency headwinds, and margins to be "slightly" ahead of last year after strong growth in revenue and orders in the first quarter.
For the quarter ended April 1, revenue rose 10% on a reported basis and 16% on an organic constant-currency basis. In addition, order intake was up 21% at reported and 27% at organic rates. This reflected "continuation of the more favourable market trends seen during the last quarter".
At the end of the quarter, the valve-maker's order book stood at GBP228.3 million. This was 19% higher than at the end of 2017 and 12% higher than the year prior.
Order intake increased across all four of its divisions, Rotork said. The Controls and Fluid Systems units, however, saw order intake accelerate much faster than at the Gears and Instruments divisions. This was helped, however, by "much softer" comparatives for the Controls and Fluid Systems units than for the others.
As a result, Rotork said it now expects full-year revenue to grow between "mid to high" single digits over the prior year on a reported basis. This is despite an anticipated 5% currency headwind. Rotork also expects adjusted operating margins to be "slightly" ahead of the prior year due to the "stronger than anticipated" growth.
For 2017, Rotork generated GBP80.6 million pretax profit on GBP642.2 million revenue. Its adjusted operating margin stood at 20.3%.
The FTSE 250-listed firm remained "highly" cash generative and had net debt of GBP10.0 million on April 1, down from GBP12.6 million at the end of 2017.
Rotork continued to experience an improving end market environment for its products.
The oil and gas market continued to see an improvement in upstream and downstream business despite midstream remaining "challenging". Industrial process markets saw "steady" progress whilst water and power remained "flat."
Shares in Rotork were 8.9% higher at 325.60 pence on Monday.
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