Weir maintains guidance despite falling orders in Q3

(Sharecast News) - Mining engineering company Weir has reiterated its guidance for "strong growth" this year despite orders slipping in the third quarter. Orders from continuing operations totalled £636m in the three months to 30 September, down from £651m in the same period a year before.

Minerals orders were down 2% at £469m, as a 1 increase in aftermarket orders was outweighed by a 10% drop in original equipment orders due to a strong comparative last year.

In contrast, the ESCO division saw orders fall 3% to £167m as aftermarket orders fell 5% but original equipment orders jumped 21%. The company saw particular weakness in the North American infrastructure market, impacted by dealer restocking.

Nevertheless, chief executive Jon Stanton said the company performed "in line with our expectations", as the company maintained its forecasts for "strong growth in constant currency revenue and operating profit" for the 2023 full year.

Stanton said: "We capitalised on high levels of activity in our mining markets, growing mining aftermarket orders, maintaining good momentum in original equipment and expanding our installed base to support future aftermarket growth. We also executed strongly, growing revenue, expanding our operating margins and realising the initial cost savings from our Performance Excellence transformation programme."

He said the company is entering the fourth quarter with a strong order book and operating momentum, which should help the company meet its targets of operating margins of 17%, and 80% to 90% free operating cash conversion.

Separately, Weir announced the appointment of Brian Puffer as its new chief financial officer, joining the company from BP where he serves as chief financial and risk officer of the Integrated Supply and Trading division.