Revenue Down 8.5% for Vesuvius in 2015
Vesuvius plc recently announced its preliminary audited results for the year ended December 31, 2015. Revenue declined 8.5% to approximately £1.3 billion (approximately $1.8 billion), from approximately £1.4 billion (~ $2 billion) in 2014.
Lower revenues and profits reportedly were in line with previous guidance, reflecting weakness in global steel and foundry markets. Marginal improvements in Foundry from self-help measures were undertaken by new management, and there was continued outperformance in the strategic growth areas of India, China and South America. Restructuring was initiated in the second quarter to address structural changes in end markets, and further actions were identified to respond to ongoing changes. A total annual savings of £20 million (~ $28 million) is expected toward the end of 2017, of which £8.8 million (~ $ 12.5 million) reportedly will delivered in 2015. A net debt increase of £23.3 million (~ $33 million) reportedly was primarily due to the £23.8 million (~ $33.8 million) acquisition of Sidermes SpA in the first half of 2015, and £11.5 million (~ $16.3 million) cash spend on the first phase of restructuring.
“These results reflect the substantial headwinds that we have faced in our key end-markets of steel and foundry,” said François Wanecq, chief executive. “We have been able to minimize the impact on our margins due to a continued focus on self-help measures and our substantial restructuring program launched in response to the permanent structural changes in the end markets. We expect the underlying trading environment in the current year to be broadly similar to that experienced in the second half of 2015 and have initiated a further cost reduction plan, which, together with the actions already taken, will deliver full year savings of £20 million (~ $28 million) toward the end of 2017, an increase of £10 million (~ $ 14.2 million) over the savings already announced. Despite the current challenges, our strategy for longer-term profitable growth remains unchanged and, in this context, we have made encouraging progress in 2015, strengthening our competitive position in the strategically important markets of China, India and South America through increasing penetration of our value-added products, and continuing to develop our Technical Services offering.”
For more information, visit www.vesuvius.com.