Engineering company Weir has published its financial results for the first half of 2017, showing a positive outlook despite losses in its flow control division.
Comprised of Oil and Gas, Minerals and Flow Control divisions, Weir designs, engineers and manufactures a range of solutions for a variety of fluid handling applications, including pumps and valves, and pressure pumping and control products.
The newly published figures include an updated full year outlook to reflect accelerated recovery in the North American oil and gas sector. This has seen 69% growth in Weir’s North American revenue, strong operating leverage and modest pricing improvement.
Industry investment in productivity gains helped Weir’s performance in mining markets, leading to an 11% order growth in the first half of 2017, with a book-to-bill of 1.12, and first half operating margins reflecting investment in growth, phasing of revenues and plant moves.
One-off charges of £13 million saw the Flow Control division making a loss. Nevertheless, order bookings puts the Weir Group in a position to deliver strong constant currency revenue and profit growth in 2017.
“The first half of 2017 saw the [Weir] Group make good progress as we fully captured opportunities in our main markets. In North America, the Oil & Gas division delivered a great set of results with margins rapidly improving in recent weeks. Demand increased sequentially, demonstrating shale’s position as a competitive and sustainable source of global energy supply. Mining markets also continued to improve with good demand for Weir’s technology as customers sought to increase productivity,” said Jon Stanton, CEO of Weir.
“In our two main businesses we are transitioning from an intense downturn into a recovery and growth phase. Our focus is on ensuring we take full advantage of improving markets and further enhance our leadership positions by investing in our distinctive competencies – People, Customers, Technology, and Performance – where we have made substantial progress in the first half.
“Looking to the rest of the year and assuming supportive commodity prices, expectations for our Oil & Gas division were recently upgraded, while guidance for our Minerals division remains unchanged. Overall, the Group expects to deliver strong constant currency revenue and profit growth, with good cash generation and substantial de-leveraging.”