TIDMIMI
RNS Number : 4559D
IMI PLC
28 October 2020
28 October 2020
IMI plc ("IMI" or "the Group")
Interim Management Statement
This announcement contains inside information in relation to IMI
plc.
IMI, the specialist engineering company, issues the following
Interim Management Statement, covering the third quarter from 1
July to 30 September 2020. Unless otherwise indicated, comparatives
reflect results on an organic constant currency basis. References
to adjusted results include the impact of foreign exchange and
M&A.
Current trading and outlook
Our highest priority remains the protection of our people, our
communities and our customers. Thanks to the dedication, courage
and continuing diligence of our employees, the direct impact of
Coronavirus on the business has continued to be contained. We will
maintain our vigilance and strict operating protocols for as long
as necessary to ensure we minimise this ongoing risk.
Our customers also continue to receive our closest attention.
IMI's quick and effective action to solve industry problems has
resulted in strengthened customer relationships and uncovered new
business opportunities.
Our strategic market-led innovation programme continues to gain
traction across all divisions, with initial orders won on a number
of the early Growth Accelerator projects.
Good progress is being made with the Group's strategic
restructuring initiatives to deliver a fundamentally less complex
business which is fit for growth. We remain on-track to deliver the
targeted 2020 structural savings of GBP30m. Additional benefits
from our short-term cost saving actions will also support IMI's
2020 performance by approximately GBP30m, as we have previously
flagged.
Overall trading in the third quarter has been somewhat better
than previous expectations. Revenues for the third quarter were, on
an organic basis, 1% lower compared to 2019 and, when including the
impact of foreign exchange movements and acquisitions, flat on an
adjusted basis. The results were supported by additional surge
sales within our ventilator business of GBP40m in the third
quarter. We now estimate the full year effect of this ventilator
demand surge will be a one-off revenue benefit of GBP85m, versus
the expectation of GBP70m reported in our July half-year
results.
Based on current market conditions, the resilient trading of the
third quarter, and no significant escalation of Coronavirus-related
disruption, we now expect full year 2020 adjusted EPS of 74p to
78p.
IMI Precision Engineering
On an organic basis, IMI Precision revenues in the three months
to the end of September were 3% higher when compared to the same
period last year supported by the ventilator surge sales. When
including the impact of foreign exchange movements, the division
was 2% higher on an adjusted basis.
Sales in Motion Control were 14% lower when compared to the
third quarter of 2019, improving slightly from 16% down in the
second quarter. Sales in Commercial Vehicle were 24% lower,
recovering sharply from 50% down in the second quarter. Life
Sciences revenue was 166% higher, supported by GBP40 million of
additional surge sales within our ventilator business.
Based on stronger than expected third quarter trading and higher
one-off ventilator sales, and assuming no significant escalation of
Coronavirus-related market disruption, organic revenue in the full
year is now expected to be about 5% lower when compared to last
year, with margins improved versus last year .
IMI Critical Engineering
In the three months to the end of September, organic order
intake was 23% lower when compared to the third quarter of 2019,
with Oil & Gas and Power continuing to reflect weak activity.
Aftermarket orders were 4% lower than the comparable period in
2019.
The division's order book at the end of September 2020, at
GBP523m, was 3% lower than the same point last year. The business
now has 98% orderbook coverage of its sales forecast for the
remainder of the year.
In the three months to the end of September, organic revenues
were 4% lower when compared to the same period last year, with a 5%
reduction in Aftermarket and a 2% fall in New Construction sales.
On an adjusted basis, revenues were 1% higher, when compared to the
same period last year, reflecting both the impact of foreign
exchange movements and the acquisition of PBM in September
2019.
In the full year, based on no significant escalation of
Coronavirus-related disruption, we now expect organic revenue to be
about 5% lower, when compared with 2019. We now expect margins for
the full year to be improved versus 2019, supported by improved
operational efficiencies.
IMI Hydronic Engineering
IMI Hydronic organic revenues in the three months to the end of
September were 4% lower when compared to the same period last year
and 5% lower on an adjusted basis, when including the impact of
foreign exchange movements.
Further good progress has been made towards our objective of
structurally improved margins, with our reorganisation projects
aimed at simplifying both our manufacturing and distribution
infrastructure , and improving customer service. These are
advancing well.
Based on no significant escalation of Coronavirus-related
disruption, we now expect revenues to be about 5%
lower and margins to be held broadly flat when compared with the full year 2019.
Exchange rates
Although foreign exchange rates have been volatile during 2020,
current expectations are for currency to have a limited impact on
IMI's revenue and profits in 2020, when compared to 2019.
Audit tender
An audit tender process was initiated by the Board in October,
which will result in a decision on the auditor to be proposed for
appointment at next year's AGM in May 2021.
Preliminary results
IMI will issue its preliminary results announcement in respect
of the six months ending 31 December 2020 on 26 February 2021.
Enquiries to:
Tel: +44 (0)7950 889
John Dean IMI 216
Stephen Malthouse / Jane Glover Headland PR Tel: +44 (0)7734 956
201 /
+44 (0)7884 742 400
A conference call for analysts and investors will be held at
08:00 GMT today to discuss this statement. To access the call,
please register using the link:
http://emea.directeventreg.com/registration/3590729
Notes to editors
IMI plc, the specialist engineering company, designs,
manufactures and services highly engineered products that control
the precise movement of fluids. Its innovative technologies, built
around valves and actuators, enable vital processes to operate
safely, cleanly, efficiently and cost effectively. IMI employs
around 11,000 people, has manufacturing facilities in more than 20
countries and operates a global service network. The Company is
listed on the London Stock Exchange. Further information is
available at www.imiplc.com .
IMI plc is registered in England No. 714275. Its legal entity
identifier ('LEI') number is 2138002W9Q21PF751R30. The person
responsible for releasing this announcement on behalf of the Board
is John O'Shea, Company Secretary and Group Legal Director.
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