Spirax organic growth slows; sees FY results in line with expectations

22nd Nov 2016 09:16

(ShareCast News) - Engineering group Spirax Sarco said organic sales growth in the first 10 months slowed "modestly" from that achieved in the first half of the year mainly due to the non-repeat of large projects in its steam specialties business.In a trading statement, the company said group operating profit continued to be significantly ahead of the comparable 10-month period at constant currency.This included the pre-operating and start-up losses of Hiter, acquired in July, which is performing to expectations, Spirax said."We still have much to do in the remainder of this year but our overall expectations for the full-year are unchanged and the board has confidence that the group will make further progress in 2016," Spirax said."Favourable currency movements, translational and transactional, have positively impacted reported group operating profit by 7.2% versus full-year 2015 average exchange rates and if recent exchange rates prevail to the end of 2016 we would expect the increase in operating profit for the year due to currency movements to be approximately 8.5% (translation and transaction).""If recent foreign exchange rates continue into next year we would expect to see an uplift in sales and profits of 6% and 9% respectively in 2017. If recent bond yields prevail into next year we would anticipate an increase in overall charges related to our defined benefit pension schemes of at least £3.5m."Organic sales growth in EMEA in the four months to October was lower than in the first half of the year. Year to date organic growth in Asia Pacific fell as expected, due to the non-repeat of the large project sales in China and Korea, while growth in the Americas had continued at a similar level to that seen in the first half of the year.