Rotork (ROR) down 7% as supply chain delays hit revenue
15:36, 18 November 2021
Shares of Rotork dipped 6.94% in London on Thursday as the company published its financial results for the four-month period ended 31 October.
Rotork is a British-based company manufacturing industrial flow control equipment.
Net cash as of 31 October was £103.2m, down from £178.1m as of 31 December 2020.
During the period, the company said it paid an interim dividend of £20.5m and returned £44.2m to shareholders through its £50.0m share buyback programme.
The company saw a pick-up in project and environmental related activity.
Supply chain constraints
“In the last few months component sourcing has become even more challenging and deliveries of materials sourced from Asia-Pacific regularly delayed, sometimes with little notice. Most affected have been chipsets and electronics, critical components of our market leading electric actuators. The result has been closures of production lines that have in some cases lasted several weeks.
“Adjusted operating profit margins in the period benefited from continued execution of the Growth Acceleration Programme and our focus on managing materials inflation, but the benefits compared to the prior year period were more than offset by the impact of the significantly reduced volumes, operational inefficiencies and increased logistics costs,” Rotork said.
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The company highlighted that the growth in order intake seen in the second quarter had continued over the summer and through October, in line with its expectations.
However, it anticipates the supply chain disruption currently being experienced to continue at least in the near term.
“As a result, we expect second half revenue to be similar to the first half with adjusted operating margins slightly ahead of the first half. We anticipate entering 2022 with a record year-end order book,” it said.
Rotork said it will publish 2021 full-year results on Tuesday 1 March 2022.