Vesuvius confident for full-year despite 'difficult' market conditions

15th May 2024 08:13

(Sharecast News) - Engineering firm Vesuvius reiterated its full-year guidance on Wednesday, despite seeing "subdued" steel markets throughout the first quarter.

Updating on trading , the company - a specialist in molten metal flow engineering and technology - said its performance in the four months to 30 April was in line with expectations.

Steel end markets had remained "subdued", it noted, as anticipated. The exception was India, which continued to grow, and EEMEA, which recovered from a low base following the earthquake in Turkey in 2023.

Vesuvius defines EEMEA as Europe, the Middle East and Africa excluding the European Union and the UK.

Steel production volumes in the EU27+UK region continued to be subdued, although they had improved quarter-on-quarter, the firm noted. Foundry markets, meanwhile, remained "weak".

However, Vesuvius said: "Despite these difficult market conditions, we continue to perform well, achieving market share gains in flow control and foundry.

"Net pricing has remained resilient across all three business units.

"The resilience of our business gives us continued confidence that we will deliver on our full-year 2024 expectations."

Jefferies, which has a 'buy' rating on the stock, said: "This is a solid update. While the tone of the statement is hardly upbeat, it should not be a surprise - that is management's want, it is early in the year and group's performance was in line with management expectations.

"Underlying markets are mixed, but the group continues to deliver market share gains and we look for above market growth, EBITA margin progression and good free cashflow over the next few years."