Trading Update

RNS Number : 7043D

Renold PLC

01 May 2013

 



Renold plc

("Renold", "the Company" or "the Group")

Trading Update

Renold, a leading international supplier of industrial chains and related power transmission products, today issues a trading update ahead of its full year results for the year ended 31st March 2013, which will be announced on 28th May 2013.

Trading

Challenging conditions across all end markets persisted throughout the year and underlying revenue for the full year ended down 7% compared to the prior year.  Group underlying second half revenue was 4% lower than the first half.  The impact of the revenue reduction in the second half was fully offset by management action to reduce ongoing overheads.  As a result, adjusted operating profit in the second half was in line with the first half and the full year adjusted operating profit is therefore in line with market expectations.

Working capital and debt

Working capital and capital expenditure were closely managed during the second half.  This resulted in net cash generation in the second half, whilst at the year end net debt closed below the position at the start of the year.

During March, the Group agreed a new funding plan and merger of the UK defined benefit pension plans which is expected to reduce annual cash costs by £1.0m.  In addition, since the year end, the Group completed the process of winding up the pension fund surplus in South Africa.  A pre-tax cash surplus of £1.3m was returned to the Group in April 2013 with a further £0.1m outstanding.

Robert Purcell, Chief Executive of Renold plc, said:

"We are pleased with a good improvement in book to bill ratios in the second half versus the prior year.  However, with trading conditions expected to remain challenging, we are developing plans to lower the Group's breakeven point and further improve our commercial position, and I look forward to reporting in further detail at the full year results announcement in May.  The business remains focussed on delivering sustainable cash generation which has been enhanced by the recent progress on UK and South African pension schemes."

*The use of "underlying" excludes the impact of changes in foreign exchange rates. "Adjusted" excludes the impact of exceptional items.

1 May 2013

ENQUIRIES:

Renold plc	0161 498 4500
Robert Purcell, Chief Executive
Brian Tenner, Finance Director
Arden Partners	020 7614 5917
Chris Hardie
College Hill	020 7457 2020
Mark Garraway
Helen Tarbet

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 the website at: www.renold.com

 

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