First half revenues down at Renishaw, but Board confident of long-term prospects

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First half year revenue at global manufacturer Renishaw dropped 13 per cent to £259.4 million, compared with previous year of £296.7 million, , its latest results reveal, with profits plummeting to £9.9 million compared with £61.6 million last year.

And it renewed its view that trading conditions are expected to remain challenging through the remainder of this financial year driven by the global macroeconomic environment

But the Wotton-under-Edge company believes that the structural demand drivers in its end-markets remain intact. “The Group is in a strong financial position and we remain confident in the Group’s long-term prospects due to the high quality of our people, our innovative product pipeline, extensive global sales and marketing presence and relevance to high-value manufacturing,” its trading statement said.

At this stage, it expects full year revenue to be in the range of £530m to £560m. Adjusted profit before tax is expected to be in the range of £50m to £70m, with profits in the second half of the year expected to benefit from an increase in revenue, reduced operating costs and a favourable currency impact from forward contracts compared to the first half year. Statutory profit before tax is expected to be in the range of £38m to £58m.

The Group says it remains committed to its long-term strategy of delivering growth through the development and introduction of innovative and patented products, and during the first six months of this year it incurred net engineering expenditure of £46.1m compared with £47.7m last year.

Earlier this month the company said it was considering compulsory redundancies that could result in the loss of around 200 jobs across its UK operations (approximately six per cent of total UK employees).

The company has already undertaken a wide range of measures to improve productivity and reduce its cost base, including the closure of its Staffordshire site, reductions in discretionary spend and redundancies within its UK manufacturing operations.