REG - Rotork PLC - Trading update

RotorkAnnouncement

18/11/2021 07:05

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RNS Number : 8022S  Rotork PLC  18 November 2021

Rotork Plc

Trading update

Order intake growth in-line with expectations, near-term deliveries delayed by
supply chain constraints

18 November 2021

Rotork plc ("Rotork"), the global flow control and instrumentation group,
today issues the following trading update covering the four-month period to 31
October 2021.

Trading update

Order intake in the four-month period was up a high single digit percentage
year-on-year on an OCC(1) basis with each division's orders ahead. During the
period we saw a pick-up in project and environmental related activity. The
majority of Rotork's activity continues to be driven by customers' operational
rather than capital expenditure and they continue to spend on automation and
electrification projects as well as maintenance and refurbishment.

In the last few months component sourcing has become even more challenging and
deliveries of materials sourced from Asia Pacific regularly delayed, sometimes
with little notice. Most affected have been chipsets and electronics, critical
components of our market leading electric actuators. The result has been
closures of production lines that have in some cases lasted several weeks.
Consequently, revenues in the four months were down year-on-year on an OCC
basis. Adjusted operating profit margins in the period benefited from
continued execution of the Growth Acceleration Programme and our focus on
managing materials inflation, but the benefits compared to the prior year
period were more than offset by the impact of the significantly reduced
volumes, operational inefficiencies and increased logistics costs.

Our work to develop a net-zero emissions roadmap continues and we will update
on progress at our full-year results. S&P Global recently ranked Rotork in
the top quintile globally in the Machinery and Electrical Equipment industry
in its highly regarded Corporate Sustainability Assessment. We note the
successful signing of the Global Methane Pledge by more than 100 countries at
COP26 and anticipate our work with customers to reduce their methane emissions
accelerating in 2022.

Rotork remains highly cash generative with a strong balance sheet. Net cash at
31 October 2021 was £103.2m (£178.1m at 31 December 2020). During the period
we paid an interim dividend of £20.5m (on 24 September 2021) and returned
£44.2m to shareholders through our £50.0m share buyback programme which was
completed on 9 November 2021.

Outlook

The growth in order intake seen in the second quarter has continued over the
summer and through October, in-line with our expectations. However, we
anticipate the supply chain disruption currently being experienced will
continue at least in the near term. As a result, we expect second half revenue
to be similar to the first half with adjusted operating margins slightly ahead
of the first half. We anticipate entering 2022 with a record year end order
book.

Rotork will publish 2021 full-year results on Tuesday 1 March 2022.

¹ OCC is organic constant currency results excluding acquired and
discontinued businesses and restated at 2020 exchange rates

This announcement includes inside information. The person responsible for
arranging the release of it on behalf of Rotork plc is Stuart Pain, Group
General Counsel & Company Secretary.

Enquiries:

Rotork
plc
Tel:  +44 (0)1225 733 200

Kevin Hostetler, Chief Executive

Jonathan Davis, Finance Director

Andrew Carter, Investor Relations Director

 

FTI
Consulting
Tel:  + 44 (0)20 3727 1340

Nick Hasell / Susanne Yule

Legal Entity Identifier: 213800AH5RZIHGWRJ718

About Rotork

Rotork is a market-leading global provider of mission-critical flow control
and instrumentation solutions for oil & gas, water and wastewater, power,
chemical process and industrial applications. We help customers around the
world to improve efficiency, reduce emissions, minimise their environmental
impact and assure safety. Rotork employs about 3,400 people, has manufacturing
facilities in more than 15 locations and serves 173 countries through a global
service network. Its shares have a premium listing on the London Stock
Exchange (symbol: ROR) and are a constituent of the FTSE 250 index. For more
information please visit www.rotork.com (http://www.rotork.com) .

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