Interim Management Statement

RNS Number : 3206D

Spirax-Sarco Engineering PLC

15 May 2012

 



Spirax-Sarco Engineering plc	Charlton House Cheltenham Glos. GL53 8ER
News Release	Telephone:  [phone] Fax:  [phone] www.SpiraxSarcoEngineering.com

Tuesday 15^th May 2012

INTERIM MANAGEMENT STATEMENT

Spirax-Sarco Engineering plc, the world leader in the control and efficient use of steam and in peristaltic pumping, issues the following Interim Management Statement in respect of the period from 1^st January 2012, ahead of its Annual General Meeting today at 2.00pm.

Trading

Organic sales growth was 6% for the four months ended 30^th April 2012.  However, total sales increased 3% due to unfavourable exchange movements, particularly in recent weeks, that reduced sales on translation by 2%, and due to the impact of two small business disposals in mid-2011.  At constant currency, operating profit was modestly ahead of the comparable period in 2011.  This reflected the contribution from the higher sales, largely offset by higher material costs (the effects of which are expected to reduce in the second half of the year), lower volumes in our main European factories and the impact of the economic downturn in Latin America.

Overall, trading conditions have been consistent with the commentary in our last update in early March.  Our markets in Asia continue to broadly show good strength and North America is benefiting from increased project activity and continued investment in the oil sands developments of Western Canada.  Trading conditions remain difficult, as expected, in our core European markets.  The market environment in Latin America reflects the slower economic growth in the region and decline in industrial production in Brazil.

We remain focused on our strategic priorities to drive sales growth, especially in emerging markets, to generate benefits from our increased investment in R&D over the last few years and to improve operational excellence.  We believe that economic conditions in Europe will remain sluggish and therefore we are intensifying our focus on cost reduction and operating efficiency.

Financial position

Our balance sheet remains strong and the Group had a net cash balance of £29 million at 30^th April 2012 compared with £12 million at 31^st December 2011.  There has been no material change in the financial position of the Group during the period and the principal risks and uncertainties remain those set out on pages 26 and 27 of the 2011 Annual Report.

Outlook

Our geographically diverse business generally reflects changes in economic growth and rates of industrial production.  Although economic growth rates have slowed from last year, trading conditions in the first four months of 2012 have been broadly in line with our expectations.  We note that sterling has recently strengthened and, if current exchange rates prevail, this would reduce sales on translation by over 3% for the full year.  However, given no additional market weakness, our fundamental strengths and resilient business model give the Board confidence that the Group will make further progress in 2012.

Spirax Sarco will publish its interim results on 22^nd August 2012.

Enquiries:

Mark E Vernon, Chief Executive

David Meredith, Director Finance

Tel:  [phone]

About Spirax Sarco

Spirax-Sarco Engineering plc is the world leader in both steam system management and peristaltic pumping. The Company provides a broad range of fluid control products, engineered packages, site services and systems expertise for its diverse range of over 100,000 industrial and institutional customers. The Company helps its customers to optimise production capacity, reduce energy costs and emissions, improve product quality and enhance the safety of their operations.  Spirax Sarco is headquartered in Cheltenham, England, has strategically located manufacturing plants around the world and employs approximately 4,700 people, of whom around 1,300 are direct sales and service engineers.  Its shares have been listed on the London Stock Exchange since 1959 (symbol: SPX). Further information can be found at www.spiraxsarcoengineering.com 

 

END

 

 

IMSBLGDUXSBBGDS