Last checked at 14 Oct 2010 07:00
Renold plc
("Renold" or "the Company")
Trading Statement
Renold, a leading international supplier of industrial chains and torque transmission products, is today issuing a trading update for the six months ended 30 September 2010.
The encouraging trend in sales and order growth noted in our interim management statement on 7 July 2010 has continued throughout the first half of the current financial year. Order intake has surpassed sales for five of the last six months leading to a growing order book. Order intake is 27% higher than the comparable period last year at constant exchange rates. Most of the growth has come from the Chain division where order intake is 37% ahead of last year. Torque Transmission continued the strong order performance of last year.
During the first half, sales on an equivalent currency basis were 18% ahead of the comparable period. Growth has been seen in the Chain division in all regions with Europe achieving 34% while the combined US, China and India saw 41% improvement on the comparable period.
As expected the majority of the cost savings achieved in the last two years have been retained despite the significant increase in sales. As part of the ongoing review of costs and manufacturing operations, the Group has commenced formal discussions with employee representatives on the future of the manufacturing arm of our Seclin facility in France that could result in cessation of those activities. Additionally our ERP implementation remains on schedule and this along with other initiatives is expected to improve both costs and working capital efficiency over time.
The combination of increased sales and continued cost savings has therefore led to improved profitability ahead of the Board's expectations for the first half.
Outlook
The strengthening order book gives good confidence for the third quarter. While visibility into the fourth quarter is more limited and macro-economic uncertainty continues, the Group is optimistic of maintaining the current improving profit trend in the second half.
We expect to report our interim results on 23 November 2010.
14 October 2010
Enquiries:
| Renold plc | 0161 498 4500 |
| Bob Davies, Chief Executive |
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| Brian Tenner, 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