Global trading conditions are steadily improving for Bath-headquartered global manufacturer Rotork, it said today, despite continuing uncertainty over the impact of Covid-19.
The group, which makes specialist valves for the global oil, gas, water and chemical industries, suffered a 9.7% fall in sales last year to £604.5m as coronavirus shut down large swathes of the world’s economy.
But in a first quarter trading update it said it continued to strengthen its business and repeated the forecast made at the time of its annual results in May that it was well placed to benefit from recovering demand.
It added: “Whilst the outlook for our end markets is improved, Covid-19 related uncertainty remains. We remain committed to delivering sustainable mid to high single-digit revenue growth and mid-20s adjusted operating profit margins over time.”
Rotork said all its 22 production facilities across the world were currently open and operating at close to normal output levels after had been impacted by Covid-19 closures early in the period.
“Whilst every effort is being made to keep our facilities open, we will not hesitate to close them if required or if we believe there is any risk to our colleagues or their families or friends,” it said.
Its performance during the quarter was in-line with its expectations, it added. While its order intake was “mid-single digits below the 2020 comparator,” which had been only modestly affected by Covid-19, revenue was up mid-single digits year-on-year.
It said in common with many global businesses, it was seeing elevated logistics costs and disruption to some supply routes as well as commodity cost escalation. However, this was anticipated to be largely offset by its January price increase.
It said it continued to be highly cash generative with a strong balance sheet and net cash of £190.8m against £178.1m at the end of last year.
Rotork’s half-year results are due to be published on August 3.
