23rd Mar 2016 10:34
LONDON (Alliance News) - Industrial engineer SWP Group PLC on Wednesday said interim profit halved amid a fall in sales, driven by delayed investment decisions by its customers.
SWP's pretax profit for the half to the end of December was GBP277,000, down 48% from GBP530,000 a year earlier. Revenue slipped to GBP5.7 million from GBP6.3 million and like-for-like sales for the group declined 9.0%.
SWP said its Ulva insulation systems business has been hit by timing issues, as investment decisions by its customers were postponed amid the fall in the oil price. SWP said it is difficult to predict activity levels for the coming year.
Elsewhere, production line facilities for its ULVAGRP product, which will target the oil and gas industry, have been put on hold pending the manufacture of a new machine following the failure of the machine made for the production line in Germany.
SWP said its Fullflow business is trading in line, but its nuclear sector sales have been hit by the ongoing delays to EDF Energy's Hinkley Point project. This has hit revenue and profit in SWP's Plasflow business. EDF Energy is expecting to make a final investment decision on the Hinkley Point nuclear reactor in early May, the BBC reported Tuesday.
SWP said it will look to keep tight control on costs in 2016 and expects an improvement for ULVAShield cladding system sales in the second half, though revenue for the Plasflow business will be delayed beyond the current financial year.
SWP shares were down 9.5% to 5.77 pence.
By Sam Unsted; [email protected]; @SamUAtAlliance
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