REG - Renishaw PLC - Trading Statement

RenishawAnnouncement

08/05/2024 07:00

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RNS Number : 5114N  Renishaw PLC  08 May 2024

Renishaw plc
Trading update
8 May 2024

 

Solid performance in mixed markets; early signs of semiconductor equipment
recovery

Renishaw plc, the global provider of manufacturing technologies, analytical
instruments and medical devices, publishes this trading update for the nine
months ended 31 March 2024. It contains unaudited information that covers the
first nine months of the financial year.

 

Q3 trading activity

 

                                             3 months to 31 March 2024  3 months to 31 December 2023  3 months to 30 September 2023
 Manufacturing technologies                  £162.5m                    £154.3m                       £156.8m
 Analytical instruments and medical devices  £9.9m                      £11.7m                        £7.7m
 Total revenue                               £172.4m                    £166.0m                       £164.5m

 

Revenue in the third quarter was £172.4m, 4% above the average in the first
two quarters. Additive Manufacturing delivered strong growth during the third
quarter, whilst co-ordinate measuring machine (CMM) and gauging systems
continued to perform well. We also saw early signs of recovery in demand for
position encoders from semiconductor equipment builders. By contrast, demand
for metrology sensors for machine tools from consumer electronics customers
was weaker than in the first half of the year.

 

9 months to 31 March 2024 trading activity

 

                                             9 months to 31 March 2024  9 months to 31 March 2023  Change  Change at constant currency*
 Manufacturing technologies                  £473.6m                    £496.7m                    -5%     0%
 Analytical instruments and medical devices  £29.3m                     £25.3m                     +16%    +17%
 Total revenue                               £502.9m                    £522.0m                    -4%     0%

 Adjusted(*) profit before tax               £86.8m                     £111.8m                    -22%    -
 Statutory profit before tax                 £86.8m                     £117.3m                    -26%    -

 

Revenue

Revenue for the nine-month period was £502.9m, compared to £522.0m for the
corresponding period last year, representing a 4% reduction at reported
exchange rates. At constant currency, revenue was in line with the previous
year, with an increase of 5% in APAC offset by reductions of 6% in EMEA and 2%
in the Americas. Manufacturing technologies revenues were 5% lower at reported
exchange rates (0% at constant exchange rates), with growth in CMM and gauging
systems sales in the Industrial Metrology area of our business being offset by
lower revenues for our Position Measurement products. Analytical instruments
and medical devices revenue was 16% higher (+17% at constant exchange rates),
with strong growth in both Spectroscopy and Neurological.

 

Profitability

Adjusted profit before tax for the nine-month period was £86.8m (FY2023:
£111.8m), amounting to 17% of revenue (FY2023: 21%). This reduction in profit
primarily relates to the impact of currency and increased employee pay,
including £2.1m of severance costs. Statutory profit before tax amounted to
£86.8m (FY2023: £117.3m).

Financial position

The Group balance sheet remains strong with cash and cash equivalents and bank
deposit balances of £207.4m at 31 March 2024 (30 June 2023: £206.4m).

Outlook

We have continued to deliver a solid performance in mixed market conditions,
with growth from capital goods products and the early signs of recovering
demand from semiconductor equipment builders. We expect the recent improvement
in our trading performance to strengthen in the remainder of the financial
year, as market conditions improve and as we continue to realise the benefits
from a range of targeted growth opportunities.

To support our growth strategy, we continue to focus on productivity and to
make targeted investments in our people, our production facilities, and our
new product pipeline.

 

In our interim statement released 6 February 2024 we communicated that we
expected full year revenue to be in the range of £675m to £715m and
adjusted profit before tax to be in the range of £122m to £147m. We now
expect revenue to be in the range of £680m to £700m and adjusted profit
before tax to be in the range of £122m to £135m.

 

We are holding our annual Capital Markets Day on 18 June 2024. Further
details, including how to register, can be found at
www.renishaw.com/en/capital-markets-day-tuesday-18th-june-2024--48647.

 

 

 Will Lee           Allen Roberts
 Chief Executive    Group Finance Director

 8 May 2024

 Renishaw plc
 Registered office  New Mills, Wotton-under-Edge, Gloucestershire, GL12 8JR
 Registered number  01106260
 Email address      communications@renishaw.com
 Website            www.renishaw.com

 

 

*In accordance with Renishaw's Alternative Performance Measures (APMs) policy
and ESMA Guidelines on Alternative Performance Measures (2015), APMs included
in this statement are: Revenue at constant exchange rates and Adjusted profit
before tax.

 

Revenue at constant exchange rates is defined as revenue recalculated using
the same rates as were applicable to the previous year and excluding forward
contract gains and losses.

 

 £'m                                                     9 months to 31 March 2024  9 months to 31 March 2023
                                                         £'m                        £'m
 Statutory revenue as reported                           502.9                      522.0
 Adjustment for forward contract losses                  2.7                        5.5
 Adjustment to restate at previous year exchange rates   21.1                       -
 Revenue at constant exchange rates                      526.7                      527.5
 Year-on-year revenue growth at constant exchange rates  0%                         -

 

The adjustment to statutory profit relates to the accounting treatment of
certain forward currency contracts used as hedging instruments which do not
qualify for hedge accounting as they do not meet the hedge effectiveness
criteria set out in the International Accounting Standard IFRS 9 'Financial
Instruments'. The Board deems that the adjusted profit before tax also
represents a useful measure of performance of the Group. All previously
ineffective contracts matured in FY2023 and no further contracts have been
designated as ineffective in FY2024. The following table reconciles statutory
profit before tax to adjusted profit before tax.

 

 £'m                                                                                   9 months to 31 March 2024  9 months to 31 March 2023
                                                                                       £'m                        £'m

 Statutory profit before tax                                                           86.8                       117.3
 Fair value (gains)/losses on financial instruments not eligible for hedge accounting
   - reported in revenue                                                               -                          (6.9)
   - reported in (gains)/losses from the fair value of financial instruments           -                          1.4
 Adjusted profit before tax                                                            86.8                       111.8

 

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