Renold PLC (AIM:RNO) saw its shares shoot up over 13% on Wednesday after the supplier of industrial chains and power transmission products said it expects profits for the current year to beat market forecasts.
In a trading update, the company reported strong trading for the 10-month period to end-January, with order intake running ahead of sales.
Turnover for the 10 months to 31 January 2023 totalled £199mln, 17.3% higher than the prior year at constant currencies, while group order intake grew by 11.6% to £216.5mln.
Excluding the impact of long-term military contracts, order intake increased by 13.7% at constant exchange rates, with North America being particularly strong, although ordering patterns have started to normalise in Europe and India from the elevated levels experienced earlier in the financial year, Renold noted.
The current order book stands at a record high of £104.1mln, compared with £99mln at the end of September 2022.
“Given the continued sales growth, a strong order book, benefits of the cost reduction and efficiency programmes, and the successful recovery of cost inflation on raw material and energy, the board is confident the current trading momentum will deliver revenues and underlying operating profit for the full year in excess of market expectations,” Renold said.
Shares jumped 13.06% to 27.70p in midmorning trading.