(Alliance News) - British engineering company Renishaw PLC on Thursday warned of the continuation of "very challenging" conditions due to the Covid-19 pandemic, after reporting a 97% drop in annual pretax profit but a smaller 53% reduction in adjusted profit.
Chief Executive Officer Will Lee said: "Given the uncertain macroeconomic backdrop, including the pandemic and the risks posed by reduced freedom of global trade, we expect very challenging market conditions, particularly in the automotive and aerospace sectors."
The Wotton-under-Edge, Gloucestershire-based measurement and motion control devices maker recorded GBP3.2 million pretax profit for the financial year that ended June 30, down 97% from GBP109.9 million recorded a year ago. The sharp drop was attributed to restructuring costs, losses in value of financial instruments and financial expenses.
Stripping out exceptional items, pretax profit fell 53% to GBP48.6 million from GBP103.9 million.
Annual revenue fell 11% to GBP510.2 million from GBP574.0 million.
"Revenue was lower in all regions, with the challenging global macroeconomic conditions throughout the year and the COVID-19 pandemic impacting most product lines," Renishaw explained.
Metrology division revenue was lower by 11% at GBP475.2 million, largely as a result of trade tensions between the US and China, weaker demand in the machine tool sector, and the impact of the pandemic.
Healthcare revenue decreased by 15% to GBP35.0 million, with Covid-19 causing delays in orders, shipments, installations and postponements of elective surgery.
Renishaw has decided against declaring a final dividend in respect of financial 2020. The company intends to review its dividend position in financial 2021, with the intention of reinstating the dividend as soon as it is appropriate to do so.
Shares in Renishaw were down 11% at 4,687.62 pence each in London on Thursday morning.
By Tapan Panchal; tapanpanchal@alliancenews.com
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Renishaw (RSW)
