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Spirax warns on strengthening pound; sees unchanged forecasts
Specialist engineering firm Spirax-Sarco warned that currency tailwinds could hit full year sales and profits if sterling stayed at current levels.
In a trading update, Spirax said the pound had strengthened slightly since full year results were reported in March after two years of forex tailwinds.
It added that sales and profits could be 3% and 5% lower respectively if April's exchange rates continued for the rest of the year.
"Movements in exchange rates are often volatile and unpredictable, therefore the actual impact could be significantly different," the company said.
On current trading, Spirax said forecasts for industrial production growth rates for 2018 were similar to those seen in 2017 and our overall expectations of organic growth and trading margins were unchanged.
"Within the Steam Specialties business we have seen improved growth in the Americas, while growth has been lower in Asia Pacific and EMEA, albeit both segments had a very strong start to the year in 2017. Watson-Marlow continues to see growth in EMEA, Asia Pacific and the Americas," Spirax said.
"Provided there is no material deterioration in trading conditions the board has confidence that the group will make further progress in 2018," it added.