Weir Group PLC (LSE:WEIR) said “highly supportive” conditions in the mining industry had driven very strong demand for mining equipment and spares as it updated the market on third-quarter trading.
The engineering group said demand was good across all regions, with particular strength in South America as miners maximised copper production, and also in North America as the re-shoring of production to the US and the recent resurgence in activity in Canadian oil sands continued.
Group orders in the quarter rose 19% with after-market orders up 21%.
Weir left full-year revenue, profit and operating margin guidance unchanged.
Looking further ahead, conditions in mining markets are strong and the long-term fundamentals are highly attractive, the group commented, with no impact yet on mining markets from the current macro-economic and geopolitical conditions.
In infrastructure markets, Weir forecast activity in North America would remain stable, with weak demand continuing in Europe.
Jon Stanton, chief executive officer, commented: “Moving into the fourth quarter, supply chain challenges are easing, we have strong operating momentum and a record order book.”
Broker Peel Hunt was impressed: “Weir issued a strong third-quarter update, which is encouraging but not a surprise given the commentary in the last week from Epiroc, CAT, Terex, Metso and others.”
On valuation the broker could not have been clearer: “Great end markets, great fundamentals, great market positions - very much a Buy and we maintain our 1,950p price target.”