6th Mar 2014 12:33
LONDON (Alliance News) - Spirax-Sarco Engineering PLC Thursday reported an increase in profit and revenue for the full year, reflecting a strong performance across its two main businesses, Steam Specialties and Watson-Marlow Pumps.
The manufacturer of boiler and pipeline control valves for steam heating and process plants posted pretax profit of GBP145.7 million, up from GBP124.1 million, as revenue rose 4% to GBP689.4 million from GBP661.7 million.
The Steam Specialties business saw growth across two of its three geographical regions - Europe, Middle East and Africa (EMEA) and Asia Pacific.
Steam Specialities sales in EMEA increased 5% to GBP244.3 million from GBP232.8 million. Spirax-Sarco said it achieved organic sales growth of 3%, and favourable exchange rate movements added 2% to sales due to the stronger euro, partially offset by weakness in the South African and Turkish lira.
Operating margin for the Steam Specialities business in EMEA rose to 19.7% from 15.8%, with only a small benefit from exchange rate movements.
Steam Specialities sales in Asia Pacific rose 10% to GBP182.8 million from GBP166.9. million in 2012. The firm said exchange movements were generally favourable, adding 2% to sales on translation into sterling due to the Chinese renminbi and the Korean won both strengthening by 4% against sterling, which was partly offset by the weakening of the Australian dollar and Japanese yen.
In addition, the firm said the Steam Specialties business in Korea performed well in the face of difficult economic conditions. Second half sales were much stronger in Korea as a number of large projects were completed.
Operating margin for the Steam Specialties business in Asia Pacific was unchanged at 26.3%.
Spirax-Sarco said the Steam Specialties business in the Americas struggled, with revenue down to GBP132.0 million, from GBP137.5 million. Sales were lower due as two large orders were not renewed and lower project activity related to a contract in Canada.
Operating margin for the Steam Specialties business in the Americas rose to 19.8% from 19.1%, due to cost reduction actions and efficiency improvements, including a small reduction in headcount.
Spirax-Sarco said its Watson-Marlow Pumps arm saw revenue growth of 5% to GBP130.3 million, from GBP124.5 million in 2012. The company said there was good growth across most product lines with a "meaningful "contribution from the new Qdos and Apex products. Operating margin for Watson-Marlow rose to 30.3% from 29.6%.
The Watson-Marlow division manufacturers peristaltic pumps, tube pumps and hose pumps.
Overall operating margin rose to 22.0% from 20.6%.
During the period, the company made a number of acquisitions, including a deal to buy the business and assets of PT Petrolog MUM - Spirax-Sarco's steam specialties distributor in the Java region of Indonesia - in a deal worth GBP1.7 million.
Following a short transition period, the new subsidiary started trading in January, Spirax-Sarco said.
Spirax-Sarco declared a final dividend of 41.0 pence up from 37.0 pence, making a total dividend of the year of 59.0 pence from 53.0 pence.
Its stock was trading at 3,058.00 pence, up 1.00 pence.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
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