Vesuvius sees full year at lower end of market views

Vesuvius expects its full year performance to be towards the lower end of market views as it continues to tackle adverse conditions through a combination of self-help and enhanced restructuring actions.

Current expectations are for earnings before interest, taxes and amortisation before restructuring and one-off items of between £125m and £137m.

The molten metal flow engineering specialist said that since its first half results in July, it continues to experience headwinds in trading performance due to the ongoing deterioration in global steel and foundry markets.

It noted that global steel production for the year to September was 2.4% lower compared to the same period last year, as reported by the World Steel Association. Although there has been growth in India, this was offset by a decline in China and EMEA and the continuing reduced levels in US production volumes.

As far as the global foundry industry is concerned, market conditions have remained challenging, particularly in mining in the US, Brazil and Australasia.

Vesuvius said its sales for the year to the end of October were down 5.2% from the corresponding period last year at constant currency, although margins have been maintained at similar levels thanks to ongoing self-help actions.

“This resilience to the adverse trading environment reflects our strategic progress and the mitigating actions of the restructuring programme announced earlier this year. These restructuring initiatives are being enhanced and, as outlined previously, we expect to see some early benefit in our 2015 results,” the company said.