CORRECT (Nov 8): IMI Quarterly Revenue Grows After Bimba Purchase

(Correcting that Critical Engineering division's order book was GBP520 million, not ...

Alliance News 9 November, 2018 | 9:13AM
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(Correcting that Critical Engineering division's order book was GBP520 million, not Petrochemical.)

LONDON (Alliance News) - IMI PLC on Thursday said it expects to report earnings growth in the second half of 2018 after revenue improved in the third quarter.

The engineering company said for the nine months to September-end, organic revenue was 5% higher year-on-year.

Revenue for the third quarter was, on an adjusted basis, 7% higher than a year earlier and, after adjusting for the impact of foreign exchange movements and the acquisition of Bimba Manufacturing Co, it was 3% higher on an organic basis.

In January, IMI acquired US-based engineering firm Bimba for USD198 million in cash, as part of the company's strategy to increase US earnings.

On Thursday, the company said the integration of Bimba continues to progress well and it remains on-track to deliver the benefits anticipated at the time of acquisition.

On a divisional basis, the nine-month order intake in the company's Critical Engineering division was 2% higher year-on-year. In the third quarter, order intake was up 40% higher with significant new projects booked in Petrochemical.

The Critical Engineering division's order book at the end of September stood at GBP520 million, down 3% on the prior year.

In the Precision Engineering unit, revenue in the third quarter rose by 15%, after the division delivered good growth in Asia-Pacific and continued to make progress in the Americas and Europe.

The Hydronic Engineering segment organic revenues in the three months to the end of September were 2% lower year-on-year, as IMI exited businesses that generated "unacceptable" returns.

Looking forward, IMI expects organic revenue and profit to improve in the second half of 2018, supported by market growth in Precision Engineering, rationalisation benefits in Critical Engineering, and an improved profit performance from Hydronic Engineering.

In addition, the company said it will continue to invest in new product development to enhance growth, improve operational performance and modernise its IT infrastructure.

IMI will issue its preliminary results announcement for 2018 on March 1.

The stock was trading 2.6% lower on Friday at 955.00 pence a share.

By Evelina Grecenko; evelinagrecenko@alliancenews.com

Copyright 2018 Alliance News Limited. All Rights Reserved.

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Security Name Price Change (%) Morningstar
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IMI PLC 925.50 GBX -1.44 -
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