Aveva posts strong profit rise and targets £25m cost cuts

A strong performance by Aveva’s heritage business fuelled a 6.8% rise in annual profit as the engineering and industrial software group targeted £25m of cost reductions from its merger with Schneider Electric.

Aveva’s shares surged after it posted adjusted pre-tax profit for the combined group of £162.8m, up from £152.4m a year earlier, for the 12 months to the end of March. Revenue rose 8.6% to £704.6m.

Adjusted pre-tax profit at the Aveva’s heritage business rose 23.3% to £67.8m. Adjusted earnings at Schneider Electric rose 0.7% to £98m.

Aveva completed the reverse takeover of the Schneider business on 1 March. The deal, which saw the France giant take a 60% stake in the enlarged group, is intended to give Aveva more scale and products to capitalise on the shift towards digital processes in industry.

Announcing its results on Thursday, Aveva said it was aiming for £25m of cost cuts from the purchase by the end of 2020 and material revenue gains over the medium term. Aveva’s shares jumped 13.4% to £28.70 at 08:32 BST.

Craig Hayman, Aveva’s chief executive, said: “I am pleased with the results that we have announced today, which are a credit to the hard work of our people in what has been a very busy year. The integration of the business has begun in earnest to drive top-line synergies. I am excited about the opportunities that lie ahead of us and will be focused on driving profitable growth."

Aveva held the final dividend at 27p a share following a return of value of £10.15 a share to Aveva shareholders in March.