London – An increase in conveyor-belt order intakes and a strong performance by its advanced engineered products (AEP) unit have given Fenner Plc a renewed sense of optimism for the current financial year.
In a trading update published 11 Jan, ahead of the company’s AGM, Fenner said it had had a “robust” start to its financial year, which commenced 1 Sept 2017.
The company said it had continued to transition from recovery to sustainable growth with all businesses doing well.
Part of the AEP business, Fenner’s advanced sealing technologies A(AST) business performed well, with its oil & gas unit “significantly ahead of the same period last year.”
AST, added Fenner, is increasing investment in product development, particularly in hydraulic fracturing.
Another AEP unit, ‘precision polymers’ was also reported as “generating revenue growth in excess of market indicators.”
Fenner also reported growth in its Engineered Conveyor Solutions (ECS) unit, which had been suffering for the past few years as result of low demand and price pressure.
In the Northern Hemisphere, ECS is seeing increasing order intake across its North American business, said Fenner, which has been restructuring the business in North America over the past two years.
“The newly launched Patriot X range of industrial belts is being well received,” the company added.
In Europe, the UK-based group noted “early signs that project work may be returning.”
Fenner expects European business to pick-up in the second half of its financial year.
In the Southern Hemisphere, ECS Australia has seen “notable increases” in its order book over the past two months as mines’ purchasing of conveyor belt recovers in the region.
In South Africa, Fenner said it had signed a supply in July 2017 and expects to complete it next months.
In China, the company said a restructuring of the mining industry was underway.
Long-term contract arrangements between Fenner and its major customers in China are expected to improve order intake in the future.
The group said that its strengthening market positions, increasing return-on-investment and a reduced US tax rate made it confident about future progress.