|
Spirax Group PLC on Tuesday said it expects second half organic sales growth to accelerate after reporting six-month results ahead of expectations. In response, shares in the Cheltenham, England-based industrial engineering company specialising in thermal energy management and fluid technology solutions jumped 15% to 6,990.00 pence each in London on Tuesday morning. It was the best performing stock in the FTSE 100 index, which itself was up 0.3%. Pretax profit declined 30% to £87.9 million in the first six months of 2025 from £124.8 million a year prior. Adjusted operating profit slipped 0.9% to £158.8 million from £160.2 million but rose 7% on an organic basis, and beat company-compiled market consensus of £152 million. Revenue fell 0.6% to £822.2 million from £827.0 million but beat consensus of £814 million. On an organic basis, revenue rose 3% on-year, outstripping consensus of 2.5%. Steam Thermal Solutions sales were in line with the first half of 2024 organically, despite the weak industrial production backdrop, while Electric Thermal Solutions organic sales growth of 10% was supported by double-digit demand growth. Watson-Marlow Fluid Technology Solutions organic sales growth was 2%, supported by growth in Process Industries and new order intake in Biopharm. ‘We have delivered first half results in line with expectations despite the challenging macroeconomic environment, demonstrating the strength of the group’s direct sales business model,’ Chief Executive Officer Nimesh Patel said. Spirax said its restructuring is on track to deliver annualised savings of around £35 million, of which half are expected to be delivered this year, weighted to the second half. The savings are mostly being reinvested in organic growth priorities. Spirax raised its interim dividend by 2.9% to 48.9p from 47.5p, as it retained annual guidance. ‘Our group guidance for the full year remains unchanged. We continue to anticipate organic growth in group revenues consistent with that achieved in 2024 and well ahead of [industrial production growth],’ Spirax said. ‘Group adjusted operating profit margin is expected to be ahead of the currency adjusted 19.4% in 2024, driving mid-single-digit organic growth in adjusted operating profit.’ In 2024, Spirax reported adjusted operating profit of £333.9 million. Spirax expects second-half organic sales growth to accelerate supported by shipments from the strong order books in STS and WMFTS and continued sales momentum in ETS despite a materially stronger comparator for the second half. Organic margin progress is also expected to be greater than in the first half, ‘driven by organic sales growth, the drop-through from high margin Biopharm and Semicon sales and the phasing of benefits from our restructuring’. Spirax said uncertainty around tariffs and the impact on global trade continues to dampen business confidence and demand for large projects, particularly in China, although ‘we are beginning to see a moderation in the rate of decline in large project orders.’ Copyright 2025 Alliance News Ltd. All Rights Reserved.
|
