Weir Q1 profits slide as project progress slows

1st May 2013 07:04

First quarter revenues and profits were down at engineering giant Weir with input falling 14 per cent against the prior year's comparator, but 14 per cent higher than the preceding quarter. Weir said it saw "good underlying sequential growth" in its minerals and oil & gas divisions and that, overall, trading was in line with expectations and guidance for the full year remained unchanged.Original equipment orders were down 32% on a reported basis while after-market orders were up 2.0% but 1.0% lower like-for-like."Materially" lower oil & gas equipment sales meant first quarter revenues and operating profits were below the prior year, as margins were affected by one-off costs in relation to the continued restructuring of its pressure pumping business.Orders were down 6.0% against the prior year at the minerals arm and Weir said its strong pipeline of future opportunities is seeing delivery dates for a number of projects delayed until the second half of the year.In oil and gas, upstream markets remain "challenging" as the average number of US oil rigs dropped 12% lower year-on-year.For the full year the group continues to expect continued gradual economic and end market improvement to help it achieve growth in the second half and "low single digit revenue growth and broadly stable margins" for the full year. The the Glasgow-based FTSE 100 firm also confirmed rumours that chairman Lord Smith of Kelvin will step down in December after holding the role since July 2002. Non-Executive Director Charles Berry has been promoted to Deputy Chairman with immediate effect and will take over as Chairman from January 2014. OH