TIDMVSVS
RNS Number : 6644E
Vesuvius plc
10 May 2017
10 May 2017
Vesuvius plc ("Vesuvius" or "the Group")
AGM Trading Update
Vesuvius plc, a global leader in molten metal flow engineering,
releases the following Trading Update in conjunction with its
Annual General Meeting being held today.
TRADING SUMMARY
At our year-end results in early March, we highlighted
encouraging early signs of improvement in the global market
environment. This trend has continued since then across our major
regions resulting in our delivery of a strong Q1 2017 in comparison
to a relatively weak Q1 2016. Consequently, whilst it is still
early in the year and whilst recognising the inherent uncertainty
in predicting end market resilience, our expectations for 2017
trading performance are cautiously optimistic.
MARKETS
We have benefitted in Q1 2017 from the 5.7% year-on-year growth
in global steel production, as reported by the World Steel
Association. However, this Q1 2017 increase in global steel
production is off the relatively low base of Q1 2016 and full year
2017 growth expectations for the market are materially lower than
this figure. In Foundry, the market environment remains mixed with
light vehicles slowing in the USA and static in the rest of the
world. Heavy truck and mining sales are showing slight signs of
recovery but this varies by region.
RESTRUCTURING
We continue to make progress in the delivery of our
restructuring programme. In addition to the benefits previously
announced, we have increased the total targeted savings of the
current restructuring programme by GBP5m at no extra cost. We
expect to see the benefit of this additional GBP5m saving commence
in the final quarter of the year such that the impact in 2017 will
be limited. The total targeted annual savings now stand at GBP40m,
up from GBP35m, whilst associated costs remain unchanged at GBP45m.
We continue to assess restructuring opportunities across our
businesses which could potentially yield further savings in the
future.
FOREIGN EXCHANGE
Although Sterling has strengthened against most major currencies
during 2017, we continue to benefit from a foreign exchange
tailwind given that Sterling remains weaker in Q1 2017 than its
average 2016 level. In Q1 2017, we have benefited from a foreign
exchange tailwind of approximately GBP2.8m compared with average
2016 rates. All things being equal, based on the average exchange
rates in Q1 2017, and were current spot foreign exchange rates to
persist for the remainder of 2017, this would have increased our
2016 Trading Profit by approximately 7%.
FINANCIAL POSITION
Whilst working capital has shown some increase in absolute terms
due to growth in sales, we have achieved a modest reduction in
working capital as a percentage of sales during the quarter.
Similarly, the net debt / EBITDA ratio has improved from the 1.8x
at year end 2016 to within our preferred range of between 1.75x and
1.25x where we expect to remain for the year.
BOARD
We are delighted that Holly Keller Koeppel joined the Board on 3
April 2017, as an Independent Non-executive Director. Holly has 35
years of global experience in business and finance. Holly serves on
the Audit, Remuneration and Nomination Committees.
CONFERENCE CALL
François Wanecq (Chief Executive) and Guy Young (Chief Financial
Officer) will be hosting a conference call for analysts and
investors at 08.30 (UK time) today (10 May).
To join the call, please use the dial in number below:
Conference call:
+44 (0)33 0336 9107 all participants
Confirmation code: 1116529
To listen to the replay of the call use the following
number:
Replay:
+44 (0)20 7984 7568 non-US participants
+1 719 457 0820 US participants
Confirmation code: 116529
ANNUAL GENERAL MEETING
The Group's Annual General Meeting is being held today at 11.00
(UK time) at The Lincoln Centre, 18 Lincoln's Inn Fields, London
WC2A 3ED.
FUTURE EVENTS
The Vesuvius final 2016 dividend of 11.40 pence per share will
be paid, subject to approval at the Annual General Meeting, on 19
May 2017 to shareholders on the register as at 7 April 2017.
Vesuvius' half year results for the six months ending 30 June
2017 are expected to be announced on Thursday, 27 July 2017.
For further information please contact:
Shareholder/analyst enquiries:
Vesuvius plc François Wanecq, Chief Executive
+44 (0) 207 822 0000
Guy Young, Chief Financial Officer +44 (0) 207 822 0000
Euan Drysdale, Group Head of Corporate Finance +44 (0) 207 822 0027
Virginia Skroski, Investor Relations Manager +44 (0) 207 822 0016
Media enquiries:
MHP Communications John Olsen/Jamie Ricketts/Ollie Hoare +44 (0)
203 128 8100
About Vesuvius plc
Vesuvius is a global leader in molten metal flow engineering
principally serving the steel and foundry industries.
We develop innovative and customised solutions, often used in
extremely demanding industrial environments, which enable our
customers to improve their manufacturing processes, enhance product
quality and reduce energy consumption. These include flow control
solutions, advanced refractories and other consumable products and
- increasingly - related technical services including data
capture.
We have a worldwide presence. We serve our customers through a
network of low-cost manufacturing plants located close to their own
facilities, and embed our industry experts within their operations,
who are all supported by our global technology centres.
Our core competitive strengths are our market and technology
leadership, strong customer relationships, well established
presence in developing markets and our global reach, all of which
facilitate the expansion of our addressable markets.
Our ultimate goal is to create value for our customers, and to
deliver sustainable, profitable growth for our shareholders giving
a superior return on their investment whilst providing each of our
employees with a safe workplace where he or she is recognised,
developed and properly rewarded.
Forward looking statements
This announcement contains certain forward looking statements
which may include reference to one or more of the following: the
Group's financial condition, results of operations, cash flows,
dividends, financing plans, business strategies, operating
efficiencies or synergies, budgets, capital and other expenditures,
competitive positions, growth opportunities for existing products,
plans and objectives of management and other matters.
Statements in this announcement that are not historical facts
are hereby identified as "forward looking statements". Such forward
looking statements, including, without limitation, those relating
to the future business prospects, revenue, working capital,
liquidity, capital needs, interest costs and income, in each case
relating to Vesuvius, wherever they occur in this announcement, are
necessarily based on assumptions reflecting the views of Vesuvius
and involve a number of known and unknown risks, uncertainties and
other factors that could cause actual results, performance or
achievements to differ materially from those expressed or implied
by the forward looking statements. Such forward looking statements
should, therefore, be considered in light of various important
factors that could cause actual results to differ materially from
estimates or projections contained in the forward looking
statements. These include without limitation: economic and business
cycles; the terms and conditions of Vesuvius' financing
arrangements; foreign currency rate fluctuations; competition in
Vesuvius' principal markets; acquisitions or disposals of
businesses or assets; and trends in Vesuvius' principal
industries.
The foregoing list of important factors is not exhaustive. When
considering forward looking statements, careful consideration
should be given to the foregoing factors and other uncertainties
and events, as well as factors described in documents the Company
files with the UK regulator from time to time including its annual
reports and accounts.
You should not place undue reliance on such forward looking
statements which speak only as of the date on which they are made.
Except as required by the Rules of the UK Listing Authority and the
London Stock Exchange and applicable law, Vesuvius undertakes no
obligation to update publicly or revise any forward looking
statements, whether as a result of new information, future events
or otherwise. In light of these risks, uncertainties and
assumptions, the forward looking events discussed in this
announcement might not occur.
Vesuvius plc, 165 Fleet Street, London EC4A 2AE
Registered in England and Wales No. 8217766
www.vesuvius.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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