Currency headwinds persist at IMI, trading in line

8th May 2014 07:46

- Trading in line with expectations- Strong pound continues to weigh on results - Overall expectations remain unchangedEngineering firm IMI said overall trading in the first four months of the year has been in line with expectations, after progress across its divisions, and expectations for future trading remain unchanged.Group revenues rose 1% on an organic basis and fell 4% on a reported basis as it continued to battle against the impact of the strong pound."The group is on track to deliver modest organic revenue growth in the first half with slightly lower margins compared to the first half of last year and an improved overall performance in the full year," it said in a company statement.In Severe Service, whose products control the flow of steam, gas and liquids in harsh environments, underlying order momentum continued in its key end markets. As expected, order intake in the first four months of 2014 was lower than the year before when large single order for a Middle Eastern oil and gas customer was secured. Revenues in the period fell 4% on an organic basis reflecting the strong prior year comparator that included backlog sales.Fluid Power revenues increased 5% on an organic basis in the first four months of the year with good progress in the European Industrial Automation market and strong activity levels in the Commercial Vehicle sector.As expected, Indoor Climate revenues during the period were broadly similar on an organic basis to the same period last year. IMI which sold the Beverage Dispense and Merchandising divisions in January for £690m, said net debt at the end of April was approximately £212m. The group underlined that its results are being adversely impacted by the relative strength of sterling compared to the prior year. "If average exchange rates in the four months to the end of April 2014 had been applied to our 2013 results, it is estimated that segmental revenue and segmental operating profit would have both been 4% lower," it explained. CJ