(Correcting to clarify that industrial production growth forecasts are not Spirax specific)

Spirax-Sarco Engineering PLC on Thursday said revenue was up by a fifth, as profit fell marginally, despite the effect of the war in Ukraine on its production growth.

The thermal energy management and pumping company reported revenue of £1.61 billion, up 20% from £1.34 billion in 2021. The revenue increase was driven by volume growth and price increases to protect margins, the firm noted.

The company said pretax profit was £308.1 million, falling 2.0% from £314.5 million a year ago.

The company declared a final dividend of 109.5 pence per share, increasing 12% from 97.5p the year prior, bringing the total dividend to 152.0p per share, also increasing 12% from 136.0p.

Spirax-Sarco said it had expected a softening of global industrial production growth after the 7.7% expansion in 2021. However, the war in Ukraine, and the resulting economic effects, as well as global supply chain disruption, have resulted in a 2022 IP growth of 2.7% for the industry, considerably lower than the 4.4% forecast in February 2022.

Looking ahead, the company said its strong business model, self-generated sales and the demand from maintenance and repairs underpins its ‘confidence in another year of progress’.

Chief Executive Officer Nicholas Anderson said: ‘We remain confident in our ability to self-generate growth and protect margins, while navigating the uncertainties ahead. In 2023, we anticipate mid-single-digit growth over 2022 group pro-forma sales, with mid-to-high single digit growth in Steam Specialties and Electric Thermal Solutions, as well as Watson-Marlow sales slightly below 2022.

‘We look forward to delivering another year of overall double-digit sales growth, together with a small progression in the group’s adjusted operating profit margin and improved cash conversion’.

Spirax-Sarco shares fell 4.0% to 11,400.00 pence each in London on Thursday morning.

Copyright 2023 Alliance News Ltd. All Rights Reserved.