Weak demand eats into Fenner profit

- Profit tumbles on weak demand for conveyor belts - Eyes progress in newer markets while demand from Russia falls - Full-year outcome expected to be unchangedReinforced polymer technology firm Fenner said first half pre-tax profit slumped by almost a third amid dwindling demand for its industrial conveyor belts and delayed sales of its advanced polymeric materials.The Hull-based firm, which supplies industrial conveyor belts to many of the world's coal and iron ore miners, said pre-tax profit for the half year ended February 28th tumbled 32% to £17.6m while revenue fell to £359.8m from £391.3m.Underlying operating profit dropped to £36.6m from £43.3m, while net cash from operations fell to £20.6m from £38.1m. Fenner, which has broadened its client base to include the oil and gas, electronics and healthcare industries, said underlying earnings per share at reduced to 10.4p from 11.9p previously. Chief Executive Officer Nicholas Hobson commented: "The group continued to make important progress towards its strategic objectives for further long-term growth in each of its two divisions."Engineered Conveyor Solutions (ECS) performed well in Australia, with like-for-like (LFL) comparatives expected to continue to improve as the year progresses. In the US, ECS revenue and order intake were hurt by rising natural gas prices and reductions in utility coal stockpiles.Progress is anticipated in ECS's newer markets, which is expected to offset weak demand from customers in Russia, Ukraine and the UK, it explained."As previously indicated, this year the seasonal weighting of revenues and operating profit towards the second half is expected to be slightly more accentuated than in recent years. "On this basis, the board's expectations for the outcome for the year as a whole remain substantially unchanged," it said. Fenner has recommended a dividend per share of 4.00p, up from 3.75p the year before. CJ