Trading Update

Rotork PLC

20 November 2024

 

20 November 2024

Rotork plc

Trading update

Higher orders year-on-year and good momentum

Rotork plc ("Rotork"), the market-leading global provider of mission-critical intelligent flow control solutions, today issues the following update covering the four-month period to 27 October 2024 (the "period").

Trading update

The Group's performance over the period was in line with management expectations. Group order intake was 8% higher year-on-year on an organic constant currency¹ (OCC) basis, with all three divisions ahead, led by Water & Power and Oil & Gas.

Oil & Gas was particularly active in the Upstream Electrification and Downstream segments and in the EMEA (Middle East) and Americas regions. The division's customers are focused on increased production (particularly of gas) and delivering on their decarbonisation commitments.

Chemical Process & Industrial ('CPI') revenues were higher year-on-year (OCC). Americas sales returned to growth, having been lower in the first half due to reduced mining sector project activity, as did China revenues. Divisional growth was driven by the chemical, critical HVAC and marine and transportation segments.

Water & Power saw strong growth in both sectors. In water there was good activity in wastewater treatment in APAC and in water infrastructure in the Americas and EMEA. Growth in Power was driven by the conventional power sector and APAC.

Rotork's full year expectations are unchanged and the Group continues to anticipate 2024 to be another year of progress on an OCC basis.

Growth+ update

Our Growth+ strategy continues to deliver strong momentum across all three initiatives of Target Segments, Customer Value and Innovative Products & Services.

Target Segments, which represent around half of group revenue, are key areas within each of our divisions where there are significant opportunities for profitable growth. To deliver on these opportunities we have invested in business development, key account management and project pursuit and we have continued to make good progress, with business wins in these target segments being increasingly significant. In Oil & Gas, LNG revenues were higher in the period compared with the first half as earlier liquefaction order wins started to ship. CPI was successful in securing an order from a South American copper miner for equipment to be used in a major water re-use project. The water infrastructure and water and wastewater treatment markets delivered encouraging order growth, particularly in the Americas and in APAC. Desalination, another Target Segment for Water & Power, made good progress in EMEA.

We continued to make strong progress under the Customer Value pillar. Since the period-end, we held the formal opening ceremony for our relocated facility in China. We will shortly launch our new Group website, a key step in improving the customer experience that Rotork provides, and open our new manufacturing site in the Kingdom of Saudi Arabia.

In Innovative Products & Services, we launched integrated ethernet functionality for our IQ range in the period. This is an important product enhancement which further differentiates our flagship electric actuators, extending compatibility, enabling higher data transfer volume and speeds, eliminating the requirement for gateway devices and operating seamlessly with our iAM (intelligent asset management) system. Integrated ethernet has multiple applications across all three Rotork sectors and the launch has been particularly well received by water industry end users.

Financial position update

Rotork remains highly cash generative and retains a strong balance sheet. Net cash including lease liabilities at 27 October 2024 was £106m (June 2024: £119m). During the period Rotork returned c. £44m to shareholders (through payment of an interim dividend and the purchase of shares under the continuing £50m share buyback programme). Rotork remains active in looking for suitable acquisition opportunities, consistent with the Growth+ strategy.

Rotork will publish 2024 full-year results on Tuesday 11 March 2025.

- Ends -

Notes:

Market expectation for 2024 revenue growth on an OCC basis is 7.7% and for adjusted operating profit margin improvement is 60 basis points. Based on exchange rates from 1 January to 27 October 2024 and assuming 27 October 2024 rates were unchanged for the rest of the year, the year-on-year currency headwind to reported full year revenues is estimated at 3½%. Visit www.rotork.com/en/investors/shareholder-information for the detailed company-compiled consensus.

¹ OCC is organic constant currency results excluding acquired and discontinued businesses and restated at 2023 exchange rates.

Enquiries:
Rotork plc	Tel:  [phone]
Kiet Huynh, Chief Executive
Ben Peacock, Chief Financial Officer
Andrew Carter, Investor Relations Director
FTI Consulting	Tel:  + 44 (0)20 3727 1340
Nick Hasell / Susanne Yule

Legal Entity Identifier: 213800AH5RZIHGWRJ718

About Rotork

Rotork is a market-leading global provider of mission-critical intelligent flow control solutions for oil & gas, water and wastewater, power, chemical process and industrial applications. We help customers around the world to improve efficiency, reduce emissions, minimise their environmental impact and assure safety. Rotork employs about 3,500 people, has manufacturing facilities in more than 15 locations and serves 170 countries through a global service network. Its shares are listed on the main market of the London Stock Exchange (symbol: ROR) and are a constituent of the FTSE 250 index. For more information please visit www.rotork.com.

 

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