Shares in West advanced engineering group Renishaw tumbled by more than 8% in early trading this morning after it revealed a 2% drop in annual pre-tax profits.
The profits fall – from £86m to £84.4m – came despite annual revenues reaching £349.6m, a record for the 40-year-old business, which designs and manufacturers world-leading measuring equipment. The shares later recovered and by noon were trading 3.5% lower.
Founder and chairman Sir David McMurtry said while the revenue figure was 5% per cent ahead of last year it was not as high as had been expected earlier in the year.
Growth was described as 'good' in the Far East, especially China, where sales were £138.8m, 7% ahead of last year's total of £130.2m. In the Americas growth was 3% ahead of last year at £79.2m (2012 £76.8m) and 9% ahead in the UK at £20.7m (2012 £18.9m). In Europe, revenue of £96.0m (2012 £95.7m) was at a similar level to last year.
Revenue from the group's core metrology (measuring equipment) business was 4% up at £317.9m, although operating profit was down 8% at £84.5m – lower than expected due to Renishaw's investment for a higher level of revenue than was actually achieved. Healthcare revenues climbed 11% to £29m. Operating losses were reduced from £8.6m to £5.4m as the doard continued to focus on achieving at least break-even in the sector over the next two years.
Sir David said: "During the year the group has further consolidated its leading position in its principal markets, as well as investing for future growth and expansion. There is an extensive new product pipeline and strategy for each of our business segments and a number of new product introductions are anticipated in this current financial year. The group faces tough comparators going into the first half of this financial year, however, we look forward with confidence to a successful 2014."
