IMI braces shareholders for flat first half

BIRMINGHAM-based engineering group IMI has warned shareholders that weaker market conditions mean its first half performance is likely to see a repeat in the decline in revenues seen during last year.

However, it has offset this by saying that it expects performance to pick up during the second half of the year, although it has said this will be accompanied by more cost reductions.

In a trading update, the company said: “Based on year to date performance and current market conditions, we continue to expect organic revenues in the first half to show a similar percentage reduction to that experienced in the full year of 2015.

“We also continue to expect an improved performance in the second half, reflecting the benefits of business improvement and cost reduction initiatives.”

It said market conditions during the first quarter had continued to be challenging and after adjusting for the impact of exchange rate movements and acquisitions and disposals, revenues for the three months to the end of March were 4% lower compared to the same period last year. On a reported basis, revenues were flat.

“Our strategic plan to drive sustainable long-term growth is making a real difference across all parts of the group,” it added.

“Our new product pipeline is developing well, the operational performance of our manufacturing facilities continues to improve and the new systems and processes we are putting in place are enabling us to do business more efficiently.  All of these initiatives are significantly enhancing our customer offering and our market competitiveness.”

The company will issue its interim results for the six months to June 30, 2016 on July 29.