Interim Management Statement

RNS Number : 9435Z

Renold PLC

13 February 2014

 



Renold plc

("Renold" or "the Company" or "the Group")

Interim Management Statement

Renold, a leading international supplier of industrial chains and related power transmission products, today issues its Interim Management Statement covering the four month period from 1 October 2013 to 31 January 2014 ("the Period").

 

The Group remains focussed on self help measures to drive continuous improvement in business performance and to support the cost of necessary future investment. As a result of improved underlying⁽¹⁾ order intake, contribution margins⁽²⁾, and overheads, the Board now anticipates that the adjusted⁽³⁾ operating profit for the full year will be above the upper end of current market expectations.

 

Trading

Underlying Group revenue in the Period was down 1.3% compared to the same four months in the prior year with the Chain Division ahead 0.5% and Torque Transmission down 6.5%.  This represents a slowing in the rate of year on year revenue decline which was 2.2% in the first half of the current financial year.  The rate of revenue decline in Torque Transmission in the Period was similar to the first half. Underlying Group order intake in the Period was 3.8% ahead compared to the same four months in the prior year with both Chain and Torque Transmission delivering growth.

 

Contribution margins are steadily improving and the breakeven point in the Group is continuing to fall as self-help measures, including cost reductions, continue to deliver benefits. Working capital and capital expenditure continue to be closely managed and net debt remains in line with the Board's expectations.

 

The project to close the Bredbury manufacturing facility, announced in October 2013, and the resulting transfer of most of the production to other Renold sites, continues to progress well. The majority of equipment transfers and additions are now complete as are the related construction projects at the receiving sites. The Bredbury site is in a period of phased run down and the project remains on track to complete within budget by the end of June 2014.

 

There have been no other significant changes in the position of the Company since the publication in November 2013 of the interim results for the six month period ended 30 September 2013.

(1)   The use of "underlying" excludes the impact of changes in foreign exchange rates.

(2)   Contribution margin is calculated as the profit margin% after the deduction of direct variable costs.

(3)   Adjusted operating profit excludes exceptional items and the costs of administering closed defined benefit pension schemes.

13 February 2014

ENQUIRIES:

Renold plc	Tel: [phone]
Robert Purcell, Chief Executive Officer
Brian Tenner, Finance Director
Arden Partners (Broker)	Tel: [phone]
Chris Hardie
Instinctif (Public Relations)	Tel: [phone]
Mark Garraway
Helen Tarbet

NOTES FOR EDITORS

Renold is a global leader in the manufacture of industrial chains and also manufactures a range of torque transmission products which are sold throughout the world to a broad range of original equipment manufacturers and distributors. The Company has a reputation for quality that is recognised worldwide. Its products are used in a wide variety of industries including manufacturing, transportation, energy, steel and mining.

Further information about Renold can be found on their website at: www.renold.com

 

END

 

 

IMSGGUQPPUPCGQP