Renishaw's profits fall on flat revenues and higher costs

Renishaw's pre-tax profits in the third quarter declined following a drop in revenues in the Far East, the UK engineering group's largest geographical market.

Renishaw's pre-tax profits in the third quarter declined following a drop in revenues in the Far East, the UK engineering group's largest geographical market.

Pre-tax profit for the quarter ended May 2nd tumbled 23% year-on-year to £16.5m, as the company's costs increased to support marketing, production and research and development.

Revenues were broadly flat at £81.9m, compared to £81.6m the previous year as a decrease in sales in the Far East offset growth in Europe, UK and the Americas.

The firm's metrology sector experience a 1.0% fall in revenue to £74.7m. The company has made investments in the electronic and semiconductor markets to help improve revenue for its encoder product line during the period.

However, the machine tool product line continued to be the biggest driver of growth in the division.

New products introduced into the market during the period included the PH10 PLUS probe head and controller, new off-axis rotary software for the XR20-W rotary calibrator and the RVC Siemens software.

In the healthcare business sector, revenue rose 24% to £7.2m, boosted by strong demand for spectroscopy products.

The company ended the quarter with a net cash balance of £35.1m compared to £22.4m a year earlier.

"As previously reported the group faces particularly tough comparators going into the fourth quarter which last year saw a number of large orders in China related to the consumer electronics market," said Chief Executive David McMurtry.

"Based on recent underlying activity levels, we currently expect that revenue in the second half will be at similar levels to revenue in the first half of this fiscal year."

He said he also expects this year's adjusted profit before tax to be around the same level as last year.

RD

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Most Popular

The FTSE 100 is set for a makeover with an influx of new tech stocks
UK stockmarkets

The FTSE 100 is set for a makeover with an influx of new tech stocks

The FTSE 100 – the dullest index in the world – is about to reinvent itself as a host of new firms list on the market. The change is long overdue, say…
24 Jan 2021
Why we won’t see a house-price crash in 2021
House prices

Why we won’t see a house-price crash in 2021

Lockdown sent house prices berserk as cooped up home-workers fled for bigger properties in the country. And while they won’t rise quite as much this y…
18 Jan 2021
Think Tesla is a bubble? This might be the best way to bet on it bursting
Oil

Think Tesla is a bubble? This might be the best way to bet on it bursting

The huge rise in Tesla’s share price means that, by market value, it’s now the sixth-largest company in the US and and the world’s biggest car-maker. …
25 Jan 2021