Rotork warns of 'modestly lower' sales

Flow control and instrumentation company Rotork warned of "modestly lower" sales on an organic constant currency basis in 2019 after a "slightly greater than usual proportion" of recent orders were not scheduled for delivery until next year.

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Rotork said the lower OCC sales were a result of order phasing, portfolio and product rationalisation and tough prior year comparatives from when the firm delivered several significant projects and sales.

The FTSE 250-listed company said customers had continued to spend on maintenance and repair as well as upgrades, modernisation and automation in the four months ended 27 October, but cautioned that large project activity had remained subdued.

Full-year adjusted operating margins were expected to show "good progress" year-on-year, benefiting from the continued execution of Rotork's growth acceleration programme and its product mix.

"We expect reported 2019 adjusted operating profit to be in-line with management expectations on an OCC basis," said Rotork.

Rotork added that it remained highly cash generative with a strong balance sheet and net cash of £66.9m at the end of the period - a marked increase on the £31.6m recorded on 31 December 2018.

As of 0815 GMT, Rotork shares had slipped 6.02% to 315.30p.