Last checked at 13 May 2008 12:00
Spirax-Sarco Engineering plc
Tuesday 13th May 2008
INTERIM MANAGEMENT STATEMENT
Spirax-Sarco Engineering plc, the world leader in the control and efficient use of steam and in peristaltic pumping, issues the following Interim Management Statement in respect of the four month period ended 30th April 2008, ahead of its Annual General Meeting today at 2.00 pm.
Trading
Overall market conditions have remained favourable in 2008. We have seen sustained business investment by our customers and we continue to benefit from good progress with our ongoing sales initiatives.
The organic revenue growth trend has continued from last year through into 2008. Growth was spread across all geographic regions for both the Spirax Sarco and Watson-Marlow Bredel businesses. The euro has strengthened considerably since late last year which, together with other currency movements elsewhere, has benefited the translation into sterling of total Group revenues by approximately 6% overall, with a larger benefit to operating profit.
Corporate Developments
The integration of Flexicon with our Watson-Marlow Bredel business is proceeding well following completion of the acquisition on 11th February 2008 for £14m. As previously reported, Marcus Steel retired as Chief Executive as of 31st March 2008, as did Peter Smith, Director and Company Secretary. On 1st April Mark Vernon, previously Chief Operating Officer, succeeded Marcus as Chief Executive and William Stebbings succeeded Peter as Company Secretary.
Financial position
The Group started the year with net cash of £16m and has subsequently paid an initial £11m consideration for the acquisition of Flexicon. There has been no material change in the financial position of the Group during the period and we continue to operate with a strong balance sheet. As anticipated, we expect capital expenditure this year to be well above normal levels mainly due to the new premises in China.
Outlook
In our preliminary statement in early March, we reported that 2008 had started well and that, assuming our global markets remained stable, we expected to produce another good performance in 2008. Trading so far this year confirms this expectation, although there remains uncertainty about the resilience of the global economy, and in particular North America. If current exchange rates prevail for the remainder of the year, sales and profits, particularly in Continental Europe, will also benefit from good exchange gains.
Enquiries:
Mark E Vernon, Chief Executive
David Meredith, Director Finance
Tel: 01242 521361