Weir Group delivers strong 2023 profits as margins beat targets

29th Feb 2024 07:22

(Sharecast News) - Weir Group managed to deliver an 18% increase in adjusted profits in 2023 after beefing up margins more than expected as it pointed to further growth across the board this year.

The Glasgow-based engineering group said full-year adjusted pre-tax profit totalled £411m last year, up from £348m in 2022, with the adjusted operating margin rising 140 basis points to 17.4%, ahead of the 17.0% target.

The company said the improvement was a result of operational efficiency, the initial benefits from its Performance Excellence cost-savings programme and a year-on-year reduction in adverse transactional FX movements.

Weir, which services the minerals and mining technology markets, said orders were flat over the year but it managed to increase revenues to £2.64bn, 9% higher than the previous year due to positive volume and pricing effects.

"Our unique capabilities are enabling us to capitalise on the structural growth in demand for critical metals and the transition to more sustainable mining," said chief executive Jon Stanton.

The board declared a final dividend of 20.8p per share, in line with its policy to pay out 33% of adjusted earnings, which takes the full-year payout to 38.6p, up 18% on 2022.

Looking ahead, the company reiterated its adjusted operating margin target of 20% by 2026, and said it has entered the new financial year with a strong order book and positive ore production trends in its mining markets.