REG - Spirax-Sarco Engng - AGM Trading Statement

SpiraxAnnouncement

15/05/2024 07:00

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RNS Number : 4363O  Spirax-Sarco Engineering PLC  15 May 2024

15(th) May 2024

Trading update

Trading in-line with expectations; full-year guidance maintained

Economic environment

Global Industrial Production growth(1) (IP) in the first quarter of 2024 was
1.7%.  As expected, IP was negative in key markets such as the USA, Germany
and South America, while conditions in China also weakened.  IP in our key
markets is forecast(1) to recover through the balance of the year, weighted
towards the second half.

Trading

In the first four months of the year, demand was broadly flat against the
strong comparative period.  Demand from Pharmaceutical and Biotechnology
('Biopharm') customers has started to show early signs of improvement
although, as expected, there has been no increase in demand from Semiconductor
Wafer Fabrication Equipment ('Semicon') customers.

All three of our Businesses delivered organic sales growth in the first four
months of the year.  Low single-digit organic growth in Group sales was
in-line with our expectations given last year's strong comparative period and
consistent with the IP weakness we had anticipated in our key markets.  Group
adjusted operating profit margin was slightly ahead compared to the same
period in 2023.

Financial Position

Net borrowings (excluding leases) at 30th April 2024 were £658 million (31st
December 2023: £667 million). The final dividend of 114.0 pence per share, a
4% increase over the prior year, will be paid on 24th May 2024, subject to
shareholder approval, with a cash impact of £84 million.

Outlook

We continue to anticipate mid to high-single-digit organic growth in Group
revenues, in line with the forecast phasing of IP and an increase in Biopharm
and Semicon demand during the latter part of the year.  Currency headwinds
are expected to persist throughout the rest of the year, with an impact of
approximately 3% to sales and approximately 6% to adjusted operating profit.
We therefore anticipate modest progress in the Group adjusted operating profit
margin compared to the 20.7% achieved in 2023, with adjusted operating
profit(2) more second half weighted than usual.

For further information:

Phil Scott, Interim Chief Financial Officer:              +44 (0)
1242 535234

Mal Patel, Head of Investor Relations:
+44 (0) 1242 535234

 

Media

Martin Robinson, Teneo:
 
+44 (0) 20 7260 2700

spiraxgroup@teneo.com

 

 

 

 

 

(1) Source: CHR Economics, 30th April 2024

(2) Consensus estimates as at 28(th) March 2024: Sales £1,738m; Adjusted
Operating Profit £365m (range £341m - £389m)

About Spirax Group

Spirax Group is positioned to play a critical role in enabling the industrial
transition to net zero, aligned to our Purpose to create sustainable value for
all our stakeholders as we engineer a more efficient, safer and sustainable
world.  We put solving customers' problems at the heart of our 'total
solutions' approach. Our global thermal energy and fluid technology solutions
improve operating efficiency and safety in our customers' critical industrial
processes. Our decarbonisation solutions use proprietary technologies to
eliminate scope 1 and 2 greenhouse gas emissions* by electrifying boilers for
the raising of steam, as well as the electrification of other critical
industrial process heating applications.

Spirax Group comprises three strong and aligned Businesses: Steam Thermal
Solutions helps customers control and manage steam within their mission
critical industrial applications, such as cleaning, sterilising, cooking and
heating.  We are helping to put food safely on the world's tables and keeping
our hospitals running. Electric Thermal Solutions has proprietary technologies
that deliver electrification solutions at scale in industrial settings,
including for the raising of steam, supporting our customers to achieve their
net zero goals. We also deliver freeze protection and defrost solutions
critical to aviation and space industries and ensure thermal uniformity in
Semiconductor chip manufacturing to power the critical electronic systems we
rely on.  Watson‐Marlow Fluid Technology Solutions is optimising the
efficient use of resources and supporting advancements in global health, such
as lifesaving vaccines and gene therapies.

Spirax Group is headquartered in Cheltenham (UK). We have 37 strategically
located manufacturing plants around the world and are committed to creating a
safe and inclusive working culture for our 10,000 colleagues, operating in 66
countries and serving 110,000 customers globally.  The Company's shares have
been listed on the London Stock Exchange since 1959 (symbol: SPX) and we are a
constituent of the FTSE 100 and the FTSE4Good Indexes.

*When connected to a green electricity source.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2024 Half Year results are expected to be published on 8th August 2024.

Further information can be found at spiraxgroup.com
(http://www.spiraxsarcoengineering.com)

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