Fenner PLC Regulatory News (FENR)

13 Jan 2010 07:00



13 January 2010 

Fenner PLC ("Fenner")

AGM Statement 2010 and Interim Management Statement

Fenner plc is issuing the following Interim Management Statement for the period from 1 September 2009 to 12 January 2010, ahead of its Annual General Meeting to be held at 10.30am today.

CURRENT TRADING

The returns generated from our trading performance during the initial months of the current financial year have been most encouraging. We are obtaining the benefits from the successful integration of the last two years' acquisitions and the operational efficiencies from our completed substantial capital investment programme. In addition, the reduction in our cost base in response to the recession has enabled us to produce improved returns at current demand levels.

Across the Group, revenues generated from the mining sector have remained robust and our technical weaving medical business has made further progress. Elsewhere, the signs of recovery in our industrial businesses are becoming increasingly apparent. The negative effects of de-stocking in the supply chain have substantially ended and there are some indications that customers have reduced inventories to unsustainable levels. Our investment in advanced manufacturing systems provides us with a platform for further market share growth through our ability to respond rapidly to customer demand from a supply chain which is short of stock.

Operating cash flow for the first quarter was significantly stronger than the previous year. With reductions in commitments for internal capital projects we have the ability to generate substantially greater organic cash flow. Consequently, borrowings are marginally lower than our expectations and less than the same period last year.

OUTLOOK

Against a strong comparative in 2008, revenue declines have slowed but, more importantly, operating profit has increased. In particular, December, normally a quiet month, yielded better than expected profits with order books strengthening in our major operations. 

This performance confirms the improved quality of earnings created through our development programmes and demonstrates the fundamental resilience of the Group. We look to reinforce these strong opening results by extracting further benefits from economic recovery and an improved operating environment. As a result, we expect this to bring attractive earnings growth.

Certain statements contained in this document constitute forward-looking statements. Such forward-looking statements involve risks, uncertainties and other factors which may cause the actual results, performance or achievements of Fenner, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such statements.

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