Fenner profits rise ahead of Michelin takeover

FTSE 250 manufacturer Fenner, which is due to be bought by France's Michelin in a £1.2bn deal, posted a 96% jump in half-year underlying pre-tax profit on Wednesday as all of its businesses continued to perform well.

In the half year to 28 February, underlying pre-tax profit rose to £32.4m from £16.5m in the same period a year ago, on revenue of £354.1m, up 15%. Underlying earnings per share rose to 8.3p from 5.3p and the company hiked its dividend to 2.1p a share from 1.4p.

Revenue in the advanced engineered products business was up 20% to £156.1m, while revenue in the engineered conveyor solutions arm was 21% higher at £198.0m.

Chief executive officer Mark Abrahams said: "In line with the board's expectations at the time of the annual general meeting in January, the results for the six months ended 28 February 2018 show significant progress on all principal measures against the same period last year.

"Since 11 January 2018, trading has continued the improving trend reflected in the AGM statement."

Fenner, which provides conveyor belts and reinforced polymer products for the mining and general industrial markets, said that its shareholders are due to vote on the Michelin deal at meetings on 16 May. If the resolutions are passed, the acquisition is expected to take effect on 31 May.

"The board of Fenner believes that the acquisition of Fenner by Michelin represents an opportunity for Fenner shareholders to crystallise in cash the value of their holdings on attractive terms; the board also believes that the combination with Michelin provides Fenner with a number of strategic benefits including the global scale and purchasing expertise of Michelin and access to Michelin's polymer capabilities."

At 0910 BST, the shares were up 0.2% to 609.37p.