Revenues increased 6%, pretax profit by 2.6%, and net profit by 17%
Companies: Vesuvius Plc
Shares in Vesuvius plc jumped 17% in early trading on Thursday after the molten metal engineering firm announced its preliminary results for 2016, reporting revenue up 6% at £1.4bn, pretax profit up 2.6% to £79.4m, and net profit up 17% to £63.2m.
The results were aided by forex tailwinds and the impact of acquisitions and disposals. The company also benefitted from restructuring, with savings of £16.6m in 2016, and forecasts of £35m saving by the end of 2017.
"As announced in October, the Group's results benefited from a foreign exchange tailwind during 2016, with most global currencies strengthening against Sterling between December 2015 and December 2016. In particular, there was a significant movement since June following the EU referendum in the UK.
Average exchange rates of Sterling to US Dollar and Euro fell by 11.2% and 11.1%, respectively, between YE 2015 and YE 2016. This currency translation effect has provided a trading profit benefit of approximately £13.1m for the year."
However, sterling's weakness also increased Vesuvius' debt to £28.7m.
CEO François Wanecq said the results were encouraging considering the challenging market conditions and were a sign of progress towards management's strategic and operating objectives.
"Whilst the trading environment remains broadly stable, we have seen early signs of improvement in 2017. Following our cost improvement efforts, we are well positioned to benefit from any recovery in demand and we will continue to focus on creating value for our customers and shareholders alike. We remain confident of making further progress, both in the near and longer term."