Last checked at 8 Feb 2010 07:00
Trading Update
Pressure Technologies plc ("Pressure Technologies" or the "Group") today announces a trading update ahead of the Group's annual general meeting on 10 February 2010:
Since the year end, we are pleased to report that our main subsidiary, Chesterfield Special Cylinders ("CSC"), has secured the expected level of orders from its major customers. CSC has, however, experienced some slowing in the conversion of prospects into orders for oil and gas support services projects. We believe that spending delays on these projects are mainly due to customer indecision in setting technical specifications and continuing economic uncertainty. It is still possible that we will convert enough orders in time to achieve market forecast for the year ending 2 October 2010. The Board, however, believes it is prudent to advise that pre-tax profit for the current year is likely to be up to £0.9 million lower than market expectations, as a result of order delays. Given delivery lead times, we will have a clearer view of the likely full year result by mid April 2010 and will update the market accordingly.
All other areas of the business continue to perform in line with market expectations and we are confident that activity will return to more normal levels in 2011. In the meantime, action is being taken to reduce operating costs to maintain CSC's margins.
The Group continues to have a strong balance sheet to support new ventures. Our focus on new markets/products is maintained and we believe that this will start to come through in 2010. In particular, Chesterfield BioGas ("CBG"), which provides a proven renewable energy solution, continues to make headway. The long awaited Government announcement on the Renewable Heat Incentive was made on 1 February 2010. This creates a level playing field with other subsidised renewable energy solutions, such as Combined Heat and Power and creates certainty in revenue streams for investees in our technology for the next 16 years. A large utility company has already announced five potential gas injection to grid projects, which could use CBG upgrading technology.
We are also announcing, today, the acquisition of a specialist pressure system component manufacturer, Al-Met Limited. Details of this acquisition are contained in a subsequent RNS announcement. The acquisition will have no significant impact on the Group's results in the current year but we are confident that it will be earnings enhancing in 2011 and onwards.
The medium to long term outlook for the Group is strong, our strategy remains sound and our progressive dividend policy will be maintained.
For further information, please contact:
| Pressure Technologies plc John Hayward, Chief Executive James Lister, Group Finance Director
| Tel: 0114 242 7500 www.pressuretechnologies.co.uk
|
| Fairfax IS PLC Simon Bennett
| Tel: 0207 598 5368 |
| Rawlings Financial PR Limited Catriona Valentine
| Tel: 01653 618 016 www.rawlingsfinancial.co.uk
|
Company description:
Pressure Technologies is the holding company for Chesterfield Special Cylinders Limited ("CSC"). CSC designs, manufactures and offers retesting and refurbishment services for a range of speciality high pressure, seamless steel gas cylinders for global energy and defencemarkets. The business has been conducted under the "Chesterfield" brand which is a long established name in the cylinders and specialised pressure vessel market.
Chesterfield BioGas, an operating division of Pressure Technologies, formed in November 2008 following the signing of a co-operation agreement with Greenlane® Biogas Limited, the world leader in biogas upgrading from raw biogas to vehicle quality fuel, gives Pressure Technologies exclusive rights to market Greenlane® equipment in the UK and Eire. Chesterfield BioGas will provide turnkey solutions for the cleaning, storage and dispensing of biomethane, produced from waste water treatment and anaerobic digestion of organic waste.