Trading Statement

RNS Number : 7468W

Renishaw PLC

28 April 2021

 

Renishaw plc

Trading update

28 April 2021

   

Renishaw plc, the global high-precision metrology and healthcare technology group, publishes this trading update for the nine months ended 31 March 2021. It contains unaudited information that covers the first three quarters of the financial year and the period since.

Trading activity

	9 months to 31 March 2021	9 months to 31 March 2020	Change
Metrology	£379.0m	£365.9m	+4%
Healthcare	£28.4m	£24.0m	+18%
Total Revenue	£407.4m	£389.9m	+4%
Adjusted* Profit before tax	£84.4m	£31.8m	+165%
Statutory Profit before tax	£106.3m	£19.7m	+440%

Revenue for the nine months to 31 March 2021 was £407.4m, an increase of 4% compared to £389.9m for the corresponding period last year.

Revenue in our metrology business for the first nine months was £379.0m, compared with £365.9m last year, with growth for many of our metrology products. This growth was most notable in our machine tool product line and our optical and laser encoder product lines, driven by continuing strong demand in the semiconductor capital equipment and consumer electronics markets. Revenue from our healthcare business for the first nine months was £28.4m, compared with £24.0m last year.

Adjusted profit before tax for the nine months to 31 March 2021 amounted to £84.4m compared with £31.8m last year. The increase in profitability reflects both the revenue growth and lower operating costs following restructuring activities initiated last year. Statutory profit before tax amounted to £106.3m (2020: £19.7m).

Financial position

The Group balance sheet remains strong with net cash and bank deposit balances of £197.3m as at 31 March 2021 (31 December 2020: £186.6m).

As announced in the interim report on 4 February 2021, an interim dividend of 14.0p net per share was paid on 6 April 2021, totalling £10.2m.

Covid-19 update

Our priorities continue to be the health and welfare of our employees, their families and the wider communities in which we operate, and to maintain high service levels to our global customer base. Our response and mitigation committee continues to meet regularly to review any developments caused by the pandemic and to take any necessary mitigating actions. All our manufacturing facilities around the world are operating under COVID guidelines and despite many challenges, supply to customers has been maintained throughout the pandemic.

Outlook

We continue to see good momentum in our business and with a strong order book we anticipate that revenue for the full year will be between £540m and £570m, and adjusted profit before tax will be between £105m and £125m. These ranges are unchanged from the trading update released 26 March 2021.

The above statement constitutes a profit forecast for the purposes of Rule 28 of the Takeover Code ("Profit Forecast") and the requirements of Rule 28.1(c)(i) of the Takeover Code apply to this statement.

The preliminary results for the year ending 30 June 2021 will now be released on 30 September.

Renishaw Directors' confirmation and basis of preparation

Renishaw plc's Directors have considered the Profit Forecast and confirm that it has been properly compiled on the basis of the assumptions stated below and that the basis of accounting used is consistent with the accounting policies of Renishaw plc, which are in accordance with IFRS and are those that are expected to be applied in preparing the annual report for the financial year ending 30 June 2021. The Profit Forecast is based on the unaudited results for the nine months ended 31 March 2021 and an unaudited forecast for the period ending 30 June 2021. The Profit Forecast does not take into account the potential external costs in relation to the Formal Sale Process announced on 2 March 2021.

In preparing the Profit Forecast the following principal assumptions were made:

·Any changes or proposed changes in relevant legislation, government, governmental policy or other regulatory requirements will not materially affect the results of the Company;

·There will be no material adverse change in economic conditions in the markets in which the Company operates, or any unusual trading patterns over the remaining period of the financial year ending 30 June 2021; and

·There will be no serious interruptions in business arising from circumstances outside the Company's control which would adversely affect the Company, its customers or suppliers.

Will Lee	Allen Roberts
Chief Executive	Group Finance Director
28 April 2021

Renishaw plc
Registered office	New Mills, Wotton-under-Edge, Gloucestershire, GL12 8JR
Registered number	01106260
LEI number	21380048ADXM6Z67CT18
Telephone number	[phone]
Website	www.renishaw.com

*  Adjusted profit before tax

The adjustment to statutory profit relates to the accounting treatment of certain forward currency contracts used as hedging instruments which do not qualify for hedge accounting as they do not meet the hedge effectiveness criteria set out in the International Accounting Standard IFRS 9 'Financial Instruments'. Restructuring costs relating to the closure of the Staffordshire site and other redundancy programmes undertaken in the third quarter were also excluded from adjusted profit before tax in the previous year.

The Board deems that the adjusted profit before tax better reflects the underlying performance of the Group. The following table reconciles statutory profit before tax to adjusted profit before tax:

	9 months to 31 March 2021	9 months to 31 March 2020
	£'m	£'m
Statutory profit before tax	106.3	19.7
Restructuring costs reported in Cost of sales, Distribution costs and Administrative expenses	-	5.7
Fair value (gains)/losses on financial instruments not eligible for hedge accounting
- reported in revenue	(0.2)	(2.9)
- reported in (gains)/losses from the fair value of financial instruments	(21.7)	9.3
Adjusted profit before tax	84.4	31.8

 

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