Renishaw profit forecasts upgraded 30% by Numis after update

7th Jan 2015 14:35

After an unscheduled trading update from engineer Renishaw released late on Tuesday afternoon, broker Numis has upgraded its profit forecast by 30% and expects consensus to follow suit.Ahead of its interim results on 29 January, the FTSE 250-listed group said first-half sales were 37% higher than the year before at an unaudited £224m and profit before tax of £55m, up 115% year-on-year.This led it to lift its guidance for full-year revenues to "£465m and £495m" with profit before tax "between £120m and £140m".Strong demand for its services is continuing, Renishaw said, with good momentum business and a record order book.Numis noted that this was the fifth positive statement by Renishaw since the start of October but despite these continuing strong demand trends, limited visibility makes forecasting 2015 difficult."For now, we continue to assume a modest decline in full year 2015 performance year-on-year given the exceptional strength this year and until we get more detail at the interims."There was little detail in the trading statement, but analyst Scott Cagehin said he expected a continuation of the strong trends seen in the first quarter driven by demand for its machine tool product line and Far East growth.On valuation he added: "The shares are currently trading on 14.2 times our annualised 2015 new earnings forecast, at the lower end of its normal range but we expect this to revert as the market digests this upgrade."