Last checked at 7 Jul 2010 07:00
Renold plc
("Renold" or "the Company")
Interim Management Statement
Renold, a leading international supplier of industrial chains and torque transmission products, is today issuing its interim management statement covering the period from 1 April 2010 to the current date.
On 8 June 2010 the Company announced its results for the year ended 31 March 2010 and commented that the final quarter of that year revealed an encouraging trend in sales growth. This sales growth has continued through the first quarter of the current year resulting in a profit for the first quarter well ahead of the Board's expectations. Order intake for the quarter has exceeded sales leading to an increased order book and a more favourable outlook for the half year to 30 September 2010. Sales visibility beyond the half year is limited and with uncertain macro-economic conditions we remain cautious as to the extent which this much improved momentum will be maintained in the second half of the year.
The recovery in activity levels is being seen across all regions with the largest gains predominantly arising in those Western economies which saw the steepest falls during the recession. Destocking by customers contributed to a significant element of the shortfall last year. It is the Board's view that destocking has largely ended and there are instances of customer restocking. Order intake for the Company in this first quarter is approximately 30% above the same period last year whilst for the Chain division it is approximately 50%. The first quarter of the last financial year (2009/10) was the low point for order intake during the economic downturn.
The reduced cost base, which was delivered last year, is continuing at the established lower level despite the increase in sales. The implementation of the Group-wide enterprise resource planning (ERP) system is progressing on budget and the expectation of further efficiency savings and inventory reductions on its completion remain unchanged. The additional funding headroom generated from the fund-raising in December 2010 has been maintained through the continued careful management of working capital.
There have been no other significant changes in the financial position and performance of the Company over the period since the publication of the financial statements for the year ended 31 March 2010.
7 July 2010
Enquiries:
| Renold plc | 0161 498 4500 |
| Bob Davies, Chief Executive |
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| Peter Bream, Finance Director |
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| College Hill | 020 7457 2020 |
| Adam Aljewicz |
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| Mark Garraway |
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NOTES FOR EDITORS
Renold is a global leader in the manufacture of industrial chains and also manufactures a range of torque transmission products which are sold throughout the world to a broad range of original equipment manufacturers and distributors. The Company has a well deserved reputation for quality that is recognised worldwide. Its products are used in a wide variety of industries including manufacturing, transportation, energy, steel and mining.
Further information about Renold can be found on their website at: www.renold.com