Victrex’ AGM statement confirms the soft Q1 performance that the market had feared, reflecting ongoing challenges in oil & gas and a weaker outlook for consumer electronics demand. Volume of 860 tonnes was 11% down year on year and more than 20% down on the robust final quarter of 2015 (1,119 tonnes). Outside of these two weak spots, the performance is described as solid. We downgraded our forecasts last week and expect no changes on the back of today’s update as management remains comfortable with current expectations for the full year on the back of improving volumes in H2. Despite the uncertainty, we continue to believe the shares are a BUY at this level, trading on a current year P/E rating of 15x, with the prospect of special dividends (total yield of 7%) from next year.
