27th Jul 2023 12:14
(Alliance News) - Vesuvius PLC on Thursday said both profit and revenue fell across the first half of 2023, noting difficult market conditions in the steel sector.
Despite this, it still decided to increase its dividend payout to shareholders and opted to "modestly" increase its full-year expectations.
The London-based molten metal flow engineering firm said first half pretax profit fell 19% to GBP94.7 million from GBP116.7 million a year earlier.
Revenue followed suit, falling 2.4% to GBP995.3 million from GBP1.02 billion a year.
Vesuvius said subdued market conditions in its Steel business led to volume declines in the first half from a yearly earlier, although this was "partly mitigated" by good pricing performance.
Despite falling performance, Vesuvius opted to raise its interim dividend by 4.6% to 6.8 pence per share from 6.5p a year earlier.
Shares in Vesuvius were down 4.6% to 456.45p each in London on Thursday at midday.
"Despite difficult market conditions, especially in the steel sector, we have performed well in the first half of the year, exceeding expectations, thanks, in particular, to a very resilient pricing performance. The Foundry division has confirmed its recovery, which should continue in 2024 when the destocking movement in the Foundry sector will have come to an end," said Chief Executive Officer Patrick Andre.
"We expect to maintain pricing discipline in the second half of the year, and we are progressing our efforts to gain market share through technological differentiation. As a consequence, noting typical seasonality and despite remaining macro-economic uncertainties, we feel confident to modestly increase our full year expectations."
Net debt at June 30 stood at GBP268.0 million, down 18% from GBP327.7 million a year earlier.
By Greg Rosenvinge, Alliance News reporter
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