7th Oct 2021 18:38
(Alliance News) - Weir Group PLC late Thursday said it continued to see strong demand across its markets in the third quarter as the engineer fell victim to an attempted cyber attack which led to significant temporary disruption.
For the third quarter to September 30, orders in the Minerals division were up 30% at GBP391 million from GBP302 million last year and orders in the ESCO unit were up 36% to GBP137 million from GBP100 million.
The Minerals unit's growth was supported by an active market for small brownfield and integrated solutions rather than any specific large projects, Weir said. Further, the ESCO arm benefited from its focus on expanding its product portfolio, particularly growth in large mining buckets.
In addition, Weir said that towards the end of the quarter it was subjected to an attempted ransomware attack.
The Glasgow-based firm said the attack did not have a detrimental effect on orders but third-quarter profitability was hurt with revenue deferrals on shipment delays and under-recoveries.
Weir said its capabilities were being progressively restored but acknowledged operational disruptions are expected.
"The above actions have led to a number of ongoing but temporary disruptions including engineering, manufacturing and shipment rephasing, which has resulted in revenue deferrals and overhead under-recoveries. Effective capabilities are being progressively restored in the coming weeks but the consequences of the operational disruption and associated inefficiencies are expected to continue into the fourth quarter," Weir said.
As such, Weir expects operating profit for financial 2021 to drop between GBP10 million and GBP20 million as a result of the attack and profit before tax and amortisation is now expected to be in the range of GBP230 million to GBP245 million. It posted pretax profit from continuing operations of GBP255.4 million in financial 2020.
Chief Executive Officer Jon Stanton said: "We responded quickly and comprehensively to what was a sophisticated external attack on our business... The continued strong demand across our markets in the third quarter, particularly for our more sustainable solutions, reinforces our view that Weir is ideally placed to benefit from a multi-decade growth opportunity, as the mining industry invests in expanding capacity while reducing its environmental impact.
"We remain on track to deliver our recently announced three-year performance goals that will see us increase revenues, expand margins and significantly reduce our environmental footprint."
The stock closed up 1.8% at 1,646.50 pence on Thursday.
By Arvind Bhunjun; [email protected]
Copyright 2021 Alliance News Limited. All Rights Reserved.
Related Shares:
Weir Group