Fenner PLC Regulatory News (FENR)

16 January 2013

Fenner PLC ("Fenner")

AGM Statement 2013 and Interim Management Statement

Fenner is issuing the following Interim Management Statement for the period from 1 September 2012 to 16 January 2013, ahead of its Annual General Meeting to be held at 10.30 am today. 

Review of Operations

Trading overall has been in line with the management expectations communicated at the time of our Preliminary Announcement in November 2012.

During our first quarter, the Engineered Conveying Solutions (ECS) division experienced demand levels from the North American coal industry as expected and above the lows of 2012. Following strong Q1 operating results in Australia, mining industry sentiment in that market has declined, primarily as a result of lower iron ore and coal prices. Other regions of the world showed steady demand patterns.

In November 2012, Australian Conveyor Engineering was acquired. This business specialises in design, manufacture, installation and maintenance of conveying equipment for mining. The business has performed well in the short time since completion.

The Advanced Engineered Products (AEP) division's activity rates have reflected the pockets of moderate channel de-stocking highlighted at the time of our preliminary results in November last year. There are encouraging signs that activity rates will be stronger in the second half as customer de-stocking programmes wind-down.

During September 2012, the AEP division acquired three businesses. American Industrial Plastics complements our existing capabilities and provides specialist expertise in precision machining of polymers. Norwegian Seals expands our presence in oil and gas to the subsea sector. Mandals, which produces lay-flat hoses, provides high value added solutions to customers' needs in fluid handling markets. The acquired businesses have all performed well during this initial period of ownership and their contribution has partially offset the effects of the channel de-stocking experienced elsewhere in AEP.

Net borrowings, after seasonal outflows, investments and acquisitions to support strategic growth, are in line with our expectations.

Outlook

We remain mindful of global economic uncertainty, which continues into 2013.

As previously highlighted, we expect trading volumes for the first half to continue at a level lower than the record levels of the prior year, and our performance to be more heavily weighted this year to the second half.

We continue to implement our business strategies and remain well placed to capitalise on the long-term growth opportunities in our core markets.

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Notes to editors:

Fenner PLC is a leading global provider of local, engineered solutions for performance critical applications. The group operates through two divisions:

Engineered Conveyor Solutions. The ECS division, trading under the Fenner Dunlop, Fenner and Dunlop brand names, is a recognised leader in the global conveying market. The division offers a unique, comprehensive suite of products and services, which cover the conveying needs of mining, power generation and bulk handling markets.

Advanced Engineered Products. The AEP division excels at solving customers' most challenging application problems. Drawing from an unprecedented array of polymer, elastomer and textile technologies, the division routinely develops innovative performance- critical components for OEM customers in markets from underground oil exploration/mining to satellites/aircraft, speciality off-road vehicles to implantable medical devices, and from bank note dispensers to wind turbines. The Division's trading names are recognised globally and include Hallite, CDI Energy Products, EGC Critical Components, FAST, Fenner Precision, Fenner Drives, James Dawson, Secant Medical and Xeridiem.