Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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Financial Highlights Full year profits are expected to be within the range of management's expectations in July and in line with the current market consensus forecast. Group operating margins for the quarter were in line with both the prior year period and the group's expectations. The board expects a reduction in year end net debt in line with previous expectations.
Third quarter update: Weir Group investors breathe a sigh of relief. Against concerns for a further lowering in profit guidance, Weir announced that current full year expectations had remained in line with its half year forecast, with investors appearing to breathe a sigh of relief – the share price rose by over 4% in early trading. Aided by the group's global presence, diverse end market exposure and targeted cost reductions, the company's operating margins for the quarter had proved in line with both the prior year period and management's expectations. Conditions had remained mixed across its end markets, impacted by increasing global macro-economic uncertainty and resultant declines in certain commodity prices. Reported order input for the group in the quarter was 8% down on the prior year and 15% lower on a like for like basis. In all, despite concerns for the health of the global economy near term, the group’s diversity and expected long term demand for commodities
Company overview In 1872, two brothers, George and James Weir, founded the engineering firm of G & J Weir. Over the past 15 years the company has turned itself from a basic pumps maker into a more broadly based "infrastructure equipment" supplier, with 2,000 products including valves and specialised actuators as well as pumps. Approximately one third of Weir’s staff of slightly more than 12,000 are engineers – with 90% of the total being based outside the UK, particularly in India, Australia and Brazil. The group is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.
Investec has put upgraded its forecasts for engineering group Weir after the firm's well-received third-quarter update on Monday. Investec has raised its 2012 adjusted PBT estimate by around 2% from £437m to £445, implying an earnings per share of around 151p. As such, target 1,850p target price is put under review. The broker has maintained its 'buy' rating on the stock, saying that the shares trace at 12 times earnings.
Jefferies has downgraded its rating for engineering giant Weir from 'buy' to 'hold' ahead of its third-quarter results next week, saying that its short-term stance is one of 'rising caution' over risks to 2012 and 2013 consensus forecasts. "We have not turned hugely bearish on Weir (more that we are cautious over the near-term) and we continue to like the business over the long-term," the broker said. "There is, however, insufficient upside to our target price (1900p) to warrant a more positive recommendation." The previous target was 2,185p.
Weir: Societe Generale initiates coverage with sell rating and 1,635p target.
Weir: Exane BNP Paribas initiates coverage with outperform rating and 2,200p target.
'Enter Rumour, painted all with tongues'. GE was mentioned in press Sep.26,2012.
Hi Does anyone have any info on possible takeover bid.
Analysts at Credit Suisse have today raised their target price on Weir to 1850p from 1750p before, while keeping their overweight rating unchanged. That for three reasons: Firstly, the company´s estimated 2013 earnings per share (EPS) forecasts have declined 17% year-to-date better reflecting pressure pumping weakness with management now actioning self-help initiatives (cutting capex, 25% reduction in SPM operating costs by year end) to offset upstream oil & gas headwinds. Secondly, as visibility improves and estimated 2013 consensus forecasts become more realistic the stock should start to re-rate towards its peer group earnings multiple from its current discount (especially as EPS growth returns in 2014). Thirdly, a full 58% of the group´s earnings before interest, taxes and amortizations is generated from a combination of Power & Industrial and Minerals with both posting a book-to-bill greater than 1 in the first half of 2012. Lastly, Credit Suisse points out that: “Weir is trading at 11.3 times Credit Suisse´s 2012 estimated earnings representing a 4% sector discount. Historically it has traded at a 10-15% premium. While a lack of earnings momentum will prevent this premium being regained for now we see the spread as overly discounting pressure pumping headwinds.”
Positive Points: The group reported strong trading at both its Minerals and Power & Industrial divisions. Order input for the Minerals business grew by 11%, while order input for its Power & Industrial business increased by 22%. Conditions across the mining and oil sands markets are expected to remain generally positive in the second half. Full year revenues, profits and margins are expected to be ahead of the board's previous expectations. Group aftermarket sales remained solid. Aftermarket orders were up 17% (11% higher like for like) with strong production trends across mining markets and good service activity in global power and oil and gas markets. Aftermarket represented 55% of total orders (2011: 51%) in the period. Orders from emerging markets were 17% higher at £494 million, representing 38% of total input. Management noted that "acquisition integrations were progressing well, with trading in line with expectations." A progressive dividend policy continues to be pursued. The half year dividend payment was increased by 11% compared to that paid for H1 2011. The shares are occasionally subject to speculative takeover rumour.
Negative Points: Uncertainties for the outlook have been expressed. Order input on a like for like basis was 1% lower when excluding recent acquisitions. Original equipment orders were 2% lower (13% lower on a like for like basis). Order input at its Oil & Gas business declined by 7%. Largely thanks to acquisitions, group net debt has risen from £673 million as of the end of 2011 to £844 million. The group focuses on business sectors which are highly dependent on economic growth. The economic outlook remains uncertain, with concerns over Europe prominent. The Gulf of Mexico oil spill and nuclear power station difficulties in Japan have raised some uncertainties.
Financial Highlights: Order input 8% higher on a constant currency basis to £1.31 billion. Order input on a like for like basis was 1% lower when excluding recent acquisitions. Revenue grew by 29% to £1.33 billion. Profit before tax from continuing operations before exceptional items and intangibles amortisation increased by 27% to £226 million. An interim dividend of 8.0 pence was announced, an 11% increase from H1 2011. Full year profit before tax, amortisation and exceptional items is expected to be between £440m-£460m with the low end of the range reflecting no improvement on Q2 in upstream Oil & Gas.
Half year results: The update broadly disappointed investors, with the share price down by over 5% in early trading. Whilst the performance during the period proved to be generally in line with expectations, uncertainties over the outlook increased. Although management anticipates some improvement for its important Oil & Gas upstream pressure pumping aftermarket, it also highlighted the uncertain timing of any improvement. Frac pump overcapacity was expected to lead to minimal original equipment orders well into 2013. In all, a better performance for its Mineral and divisions could potentially be more than offset by a worse than previously expected performance for its Oil & Gas division. On balance, the group's position in supporting major resource companies combined with expected long term demand for resources weighs against current concerns for the global economic outlook,
In 1872, two brothers, George and James Weir, founded the engineering firm of G & J Weir. Over the past 15 years the company has turned itself from a basic pumps maker into a more broadly based "infrastructure equipment" supplier, with 2,000 products including valves and specialised actuators as well as pumps. Approximately one third of Weir’s staff of slightly more than 12,000 are engineers – with 90% of the total being based outside the UK, particularly in India, Australia and Brazil. The group is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.
In spite of the poor market reaction to Weir's interim figures on Tuesday, Investec has retained its 'buy' recommendation for the Scottish engineering group, saying that the results 'should be taken positively'. The broker uses Weir's international peers to derive its price target (currently trading at 12.5 times next year's earnings), which is lifted from 1,770p to 1,850p.
Galvan Research and Trading has labelled engineering group Weir as a 'buy', saying that there is 'rebound potential' in the shares. "The underperformance from Weir Group's oil and gas division earlier in the year was taken literally by the markets as a signal to sell the stock, with the 25% profits gain for the previous year also ignored," said Galvan's head of research Andrew Gibson. "But the reiteration of full-year guidance and Jefferies's positive appraisal has caught the markets on the hop, and in the view of the Galvan Research team merits a 'buy' rating for Weir Group at current levels," he said.
0628 GMT [Dow Jones] Nomura initiates Weir Group (WEIR.LN) at reduce with a 1350p target. Says it expects Weir's FY 2012 revenues of its oil and gas division to fall 6% against consensus of 0% as it expects oil and gas Original Equipment volumes to fall 20%, causing 60 basis points of price pressure. Adds it expects service to slow from around 40% per annum in FY2010-2011 to 7% in FY2012 and 4% in FY2013. Nomura's estimated FY 2012 oil and gas margin is seen declining 130 basis points (against consensus for an increase of 90 basis points). Shares closed Tuesday at 1502p. (nina.bains@dowjones.com)
There seems to be a huge difference in share price from this time last year, is there low expectations for the interim results on 31st July? I understand analysts aren't expecting massive growth but does that warrant a 25% lesser market cap? Or is it something else like caught up in a technical **** storm?
INVESTORS added £140 million to the stock market worth of Weir Group after the Glasgow engineer issued what an analyst reckoned amounted to an earnings upgrade. Ahead of briefings with analysts yesterday Weir said it intended to re-confirm the guidance for its full year results which the company issued in May. The group said then it had enjoyed a strong performance during the first quarter and continued to expect a year of "further good progress" in line with previous guidance. However, investors were rattled by news in last month's interim management statement that order input in the key oil and gas division fell 26% on a like-for-like basis in the quarter. Weir noted then there was uncertainty about the market for pumps used in fracking for gas, following falls in the price of the commodity. Yesterday, the company highlighted a strong performance by its minerals division. The company told investors: "The minerals management team will highlight the market leadership positions in the division's core markets; its broadening and differentiated product and service offerings, and product innovation; and a number of future growth opportunities which are well developed." Weir said the company's success in winning £1 billion orders for new equipment since January 2010 underpinned the division's ambition of doubling divisional 2011 operating profits by 2016. Harry Phillips at Oriel Securities said: "They've put in a very punchy growth target for their minerals business which is in our view more than just a reiteration of guidance for the current year. It's a surprisingly up-tempo target they've set." The update may help to offset concerns about the outlook for Weir generated by last month's IMS. The shares closed 66p firmer at 1503p. http://www.heraldscotland.com/business/company-news/investors-add-140m-amid-weirs-earnings-upgrade.17917878
It is the minerals division that the firm will be trumpeting today to shareholders in a presentation designed to give them reassurance about the health of the company. Executive will seek to highlight the market leadership positions in the division's core markets; its broadening and differentiated product and service offerings, and product innovation; and a number of future growth opportunities which are well developed. "This is supported by the £1.1bn original equipment input Weir has captured since January 2010 which, as the equipment is commissioned, is expected to generate an incremental aftermarket revenue opportunity of up to £3bn over the next ten to fifteen years, underpinning the division's ambition of doubling divisional 2011 operating profits by 2016," they will say.
Shares in Weir Group rallied on Tuesday after the company reconfirmed its full year guidance. The firm's owners have been shares lose a third of their value since February, dropping from around £22 four months ago to £15 now. The news that business was on track pushed them back up 5% on Tuesday morning to 1,515p. In May the engineering giant said order input fell 26% on a like-for-like basis in its oil and gas division, which the firm put down to rapid changes in the pressure pumping market. It said it now expected full year revenues from its SPM and Mesa businesses to be slightly lower than 2011 and below prior guidance. However, Weir added that order input in its minerals division was up 18% compared to the previous year and ahead of its expectations
Weir Group PLC Capital Markets Presentation THE WEIR GROUP PLC 19 June 2012 Capital Markets Presentation The Weir Group will today hold a Capital Markets presentation for shareholders and analysts in London which will focus on the Minerals Division, providing an overview of its operations, market positioning and strong medium term outlook. Weir will also reconfirm its full year guidance for the Group overall as communicated in the Interim Management Statement of 9 May 2012. The Minerals management team will highlight the market leadership positions in the division's core markets; its broadening and differentiated product and service offerings, and product innovation; and a number of future growth opportunities which are well developed. The division's growing installed equipment base provides the platform for profitable, high quality, aftermarket revenue growth, from both products and services. This is supported by the £1.1bn original equipment input Weir has captured since January 2010 which, as the equipment is commissioned, is expected to generate an incremental aftermarket revenue opportunity of up to £3bn over the next ten to fifteen years, underpinning the Division's ambition of doubling divisional 2011 operating profits by 2016. Keith Cochrane, Chief Executive, will conclude the presentation by highlighting the positive fundamentals underpinning the medium and long term outlook for the mining equipment market. A webcast of the presentation will be available on the Group's website (http://www.weir.co.uk) from 8pm on the 19th June.
Weir Group PLC Director/PDMR Shareholding THE WEIR GROUP PLC 18 June 2012 Notification of Directors shareholding The Weir Group PLC ("the Company") announces that on 18 June 2012 Mr John Mogford, one of its independent non-executive directors, purchased 3,500 ordinary shares at a purchase price of 1454p per share. These shares will be held beneficially in his HSBC trading account. Mr Mogford as a consequence of this transaction now holds a total of 11,481 shares, representing 0.005% of the Company's issued share capital.