Last checked at 30 Sep 2020 07:00
30 September 2020
Pressure Technologies plc
("Pressure Technologies" or the "Group")
Major Contracts and Trading Update
Pressure Technologies (AIM: PRES), the specialist engineering group, today provides the following update regarding a new contract award and a milestone delay on an existing contract.
The Group is pleased to confirm that its Chesterfield Special Cylinders division ("CSC") has secured a significant contract, in excess of £3 million, to supply nitrogen storage solutions to EDF Energy for several UK nuclear power plants.
This second major order with EDF Energy comprises ultra-large high-pressure cylinders manufactured at CSC's Sheffield facility, in a series of nitrogen storage packages for delivery through mid-FY21. The contract builds on a strong and successful relationship established with EDF Energy following the first contract, announced in October 2019.
In June 2020, CSC secured an order from long standing customer BAE Systems for the supply of cylinders to the UK MOD's Dreadnought class submarine programme, covering the long lead time raw material milestone for the second boat in the series. Delayed order placement and a compressed delivery schedule are expected to result in the late receipt of material and the deferral of revenue and profit driven by this milestone from the fourth quarter of FY20 into the first quarter of FY21.
These major contracts with EDF Energy and BAE Systems reinforce the strong outlook for the Group's CSC division and demonstrate further progress with the Group's strategy to diversify the business into new markets, reducing a historical dependence on the oil & gas sector where the challenging trading conditions and slower than expected turnaround, compounded by the current pandemic, continue to adversely impact the performance of its Precision Machined Components division ("PMC").
Despite a series of proactive steps taken in PMC earlier in the year, including the closure of its loss-making Quadscot operation, divisional restructuring and cost savings, the Group expects an operating loss for the division in FY20. When combined with a lower profit anticipated in CSC, principally reflecting the expected milestone delay in the BAE Systems contract, a loss-making performance at Group level is expected for the current financial year.
A further trading update will be made in the second half of October, following completion of the current year end on 3 October 2020.
ENDS
For further information, please contact:
Pressure Technologies plc Chris Walters, Chief Executive | Tel: 0114 257 3616 PressureTechnologies@houston.co.uk |
N+1 Singer (Nomad and Broker) Mark Taylor / Carlo Spingardi | Tel: 0207 496 3000 |
Houston (Financial PR and Investor Relations) Kate Hoare / Anushka Mathew / Ben Robinson | Tel: 0203 701 7660 |
COMPANY DESCRIPTION
www.pressuretechnologies.com
With its head office in Sheffield, the Pressure Technologies Group was founded on its leading market position as a designer and manufacturer of high-integrity, safety-critical components and systems serving global supply chains in oil and gas, defence, industrial gases and hydrogen energy markets.
The Group has two divisions, Chesterfield Special Cylinders and Precision Machined Components.
Chesterfield Special Cylinders (CSC) - www.chesterfieldcylinders.com
● Chesterfield Special Cylinders, Sheffield, includes CSC Deutschland GmbH and Chesterfield Special Cylinders Inc.
Precision Machined Components (PMC) - www.pt-pmc.com
● Precision Machined Components includes the Al-Met, Roota Engineering, Quadscot, Precision Engineers and Martract brands.