09 May 2008
9 May 2008
AGM and Interim Management Statement
IMI plc, the major international engineering group, issues this interim
management statement for the period since 1 January 2008, ahead of its Annual
General Meeting to be held at 12 noon today, 9 May 2008.
Group revenues for the four month period to the end of April 2008 show organic
growth (at constant currency and excluding acquisitions) of around 7%. All five
businesses contributed positively to this growth over the period.
Markets for our Severe Service business remain buoyant. We have made very good
progress in restoring our ability to take orders and we now anticipate stronger
shipments in the second half, lifting organic growth for the year to around 5%.
This compares to our earlier guidance of a flat performance.
Our Fluid Power business is performing in line with expectations. Growth in our
sector business is maintaining its momentum, although US truck volumes are
showing recent signs of weakening with some second half schedules being pushed
off into 2009. Our general pneumatics business is performing very well with all
geographic markets demonstrating good year on year growth.
The organic revenue growth in Indoor Climate has seen some recovery from the
second half of 2007 assisted by the stabilization of the thermostatic radiator
valve business in Germany and from strong growth in Eastern Europe.
Beverage Dispense revenues are showing good growth in the US, with a healthy
contribution from new products and a strong performance from 3Wire, our on-line
beverage and food service parts business. New products have also contributed
significantly to growth in Continental Europe. The UK pub market however has
become increasingly difficult.
Merchandising has delivered strong growth particularly within the cosmetics and
food and beverage sectors. We have recently won a significant order from a US
supermarket chain, which will help continue our momentum. Sharp increases in
steel prices coupled with the traditional pricing lag, primarily in our legacy
carts business, are likely to have some impact on first half margins.
Severe Service Investigation
The independent investigation is now largely complete. We continue to cooperate
with the US Department of Justice to understand their requirements and the
timing of any action that they may take.
Share buyback and exchange rates
We have continued the on-market share buyback since the announcement of our
preliminary results for 2007 on 5 March 2008. 1,774,700 shares have been
repurchased at a cost of £8.0 million.
The weakening of sterling in the first four months of 2008 has had a positive
impact on the translation of the Group's revenues and profits. If the full year
2007 results were translated at average exchange rates ruling in the first four
months of 2008, this would result in revenues and adjusted operating profits(1)
being respectively 7% and 8% higher.
In early 2008 the Group refinanced out to 2018 $100m of the US loan notes due to
mature in 2009 and added a further $50m to this tranche. The Group has also
obtained additional committed banking facilities of £25m since the beginning of
the year. The financial position of the Group at the end of April 2008 is not
materially changed from that reported at 31 December 2007.
The Group's end markets generally remain firm with no discernible change in
order momentum in recent months. Prospects for the oil and gas and power markets
look positive for our Severe Service business.
Providing end markets remain supportive and notwithstanding some inflationary
pressures on input costs, the combination of growth from new products, strong
emerging markets growth and the benefits from our restructuring programme gives
us confidence for good progress in 2008.
IMI will announce its interim results on 28 August 2008.
(1) Operating profit before restructuring, investigation costs, intangible
amortisation and other income
- Ends -
Graham Truscott, Communications Director Tel: 0121 717 3712
Weber Shandwick Financial
Nick Oborne/Stephanie Badjonat Tel: 020 7067 0700
Notes to editors
IMI is a dynamic, worldwide company delivering innovative engineering solutions
to leading global customers in clearly defined niche markets. Its five
businesses share a common goal - to convert their industry knowledge and market
insight into customised, design-engineered solutions which create customer
advantage and value. These include severe service valves, motion and fluid
control systems, indoor climate controls, beverage dispense systems, and
merchandising display systems for retail operations.
Close customer relationships, strong positions in growing markets and clear
differentiation through technological innovation or service are the defining
characteristics of all IMI businesses.
IMI is quoted on the London Stock Exchange. Information about IMI plc can be
found on the website: www.imiplc.com.
This information is provided by RNS
The company news service from the London Stock Exchange