The industrial pumps specialist Weir Group plc (LON:WEIR) tempered an otherwise bullish trading statement by warning that profits from its minerals operation would be “slightly lower than previously indicated”.
This in turn will affect the company’s operating profits, which the firm said have also been hit by “investment in growth and one-off plant reconfiguration costs”.
Over the three months ended September 30, total orders increased by just over a fifth, with the resurgent oil and gas division where demand surged 59% being the star performer.
North America on the rebound
“As the North American onshore oil and gas industry continues to demonstrate its increased relevance as a source of global supply, our oil and gas business is fully leveraging its market leadership position in support of higher activity levels among customers,” chief executive Jon Stanton.
“While international markets remained challenging the division has accelerated in 2017 as we expected and is well placed to continue to fully capture future opportunities.
“In minerals our brownfield solutions delivered good order growth with an increasing pipeline of future opportunities.
Profits slightly lower
“Profits will be slightly lower than previously indicated due to project phasing, incremental investment in growth and one-off plant reconfiguration as we ensure the business is well set to benefit from increased momentum in 2018 and beyond.”
Minerals orders were ahead 12% compared with the same time last year, while Flow Controls saw its ‘book’ shrink by 2%, “reflecting bottoming of later-cycle markets”, Weir said.