Somero trading in line as it puts solid effort into China

Somero Enterprises told shareholders of “broad contributions” to its growth at the current early stage of the year, as well as positive market conditions it continued to see across its portfolio of territories, as they prepared for the company’s annual general meeting.

The AIM-traded firm said North America and Europe remained healthy markets with “robust” activity levels, and the board remained encouraged by performance in China in the period as it continued to work on gaining traction in the large market.

“We are similarly encouraged by solid activity levels in the Middle East, Latin America and our Rest of World territories and we see opportunities for growth in each of these markets,” the board said in its statement.

“On a product basis we have seen balanced contributions from each product category as sales of Boomed screeds, Ride-on screeds and Parts and accessories have all been key contributors to growth to start the year.”

The company said it was continuing to focus heavily on future growth initiatives and product development efforts, and had progressed in developing a solution for concrete leveling in the structural high-rise market segment.

Through job-site testing of its prototype machines, it said it gained “valuable insight” into the market segment and had identified opportunities to improve the design of the equipment that would increase the value of the offering.

“We are encouraged by the company's progress in the long-term effort to penetrate a new market segment.”

Somero said it felt “comfortable” with the positive trading environment across its footprint, and the growth opportunities visible in North America, Europe, China, Middle East, Latin America and its Rest of World territories.

“This constructive environment combined with solid margin performance and healthy operating cash flow generation means the company's trading to date is ahead of the comparable prior year period and in-line with market expectations for the full year ending 31 December.”

Somero also updated shareholders on its succession planning, reporting that it had implemented a “clear” planning process to provide for the measured transition of responsibilities from president and chief executive officer Jack Cooney to the current, experienced senior leadership team.

The transition of responsibilities was designed to take place gradually over the next three years, it explained, to ensure an orderly transition of his day-to-day responsibilities.

“Mr Cooney has been nominated for re-election to the board of directors, subject to shareholder approval at the annual general Meeting on 12 June, for a three-year term coinciding with the transition of his responsibilities as president and chief executive officer,” the board explained.

“It is expected Mr Cooney, after transition of his current executive responsibilities, will be considered by the nominating committee for re-election to the board as a non-executive director.”