Low & Bonar (LON:LWB), the engineering group that makes performance fabrics for the construction, industrial and transport markets, said this morning that it was on course to beat performance expectations in the full year to November. The company said that improved sales had continued during the early part of the year and had been maintained consistently throughout the second quarter. Like for like sales in this quarter were ahead of last year in all segments, with particularly strong performances in the transport, leisure and carpet manufacturing markets. Low & Bonar sells nearly 60% of its products into Western Europe and pointed out that its figures were benefiting from current exchange rates.

In April, Low & Bonar said that the improvement in the transport, leisure and carpet manufacturing sectors had been partly offset by the impact of the adverse weather conditions on its civil engineering and building products activities. However, these markets did improve towards the end of the first quarter of the financial year. Last year Low & Bonar saw underlying sales dip by 22% to £304.8m with pre-tax profits broadly flat at £15.8m. The group’s half year results to May are due to be published on July 13.

Speaking earlier this year, Duncan Clegg, Low & Bonar’s chairman, said: “Our strategy of focusing on attractive niche markets for performance materials, primarily in technical textiles, has created a strong business that has performed creditably in difficult circumstances. We believe that we now have a solid foundation to deliver shareholder value through profitable, cash generative, organic growth. Medium term targets have been set for organic sales growth, operating margin, asset efficiency improvements and capital structure.”

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