Chains maker Renold reports record orders and increases profit forecast

Renold, the Manchester-based international supplier of industrial chains and related power transmission products, issued a strong trading update for the four months ended July 31, 2022, today.

Ahead of the company’s annual general meeting, being held at 10am today, the company announced a record order book, and said it expects adjusted operating profits to be ahead of both market expectations, and the equivalent period the previous year.

In its statement, the company said the strong momentum experienced in the fourth quarter of the last financial year has been maintained in the new financial year, resulting in the continued recovery of both revenues and order intake.

Order intake for the period was £79.7m, an increase of 61.3% over the prior year equivalent period, or 69.3% at constant exchange rates. Excluding the recently announced £11m long term military contract, order intake for the period increased by 39.1% or 46.7% at constant exchange rates.

Current order books, at £70.5m, represent a record high for the group.

Sales revenue for the period, at £62.5m, represents an increase of 13.6% on the prior year equivalent period, or 19.9% at constant exchange rates.

Net debt remained stable during the period and totalled £18.5m as at July 31, 2021, despite an increase in working capital due to the improved activity levels and much lengthened supply chains, compared with £18.4m on March 31, 2021.

Renold benefits from significant geographic, customer and sector diversification.

Consequently, and despite uncertainty caused by considerable raw material and transport cost inflation and continuing supply chain disruption, the board now expects adjusted operating profit for both the first half and full year of fiscal year 2022 to be higher than both market expectations and the equivalent prior year period.