LONDON (Alliance News) - Specialist filtration and environmental technology company Porvair PLC Monday reported higher profit and revenue for the first half of its financial year, driven by three large contracts in its microfiltration unit, and said its outlook remains positive.
The company reported a pretax profit of GBP3.8 million for the six months to May 31, up from GBP3.0 million a year earlier, as revenue rose to GBP51.0 million, from GBP38.6 million. Revenue in its microfiltration business grew 48%, while revenue in its metals filtration unit rose 5%, or 12% at constant currency rates.
It raised its interim dividend to 1.2 pence, from 1.1 pence.
"Porvair's strategic direction and operating objectives are unchanged and continue to deliver good results. We focus on niche markets which have structural growth drivers. 2014 has started strongly, and order books are healthy across the group. The revenue benefits of previously announced large contracts are showing through with underlying growth also healthy. We continue to invest in US and UK capacity expansion and new product development," Chief Executive Ben Stocks said in a statement.
The company's microfiltration unit is working on three big deals - a USD10 million deal with South Korean steel maker Posco, a "much larger" contract with India'sReliance Industries, and a GBP11.3 million deal with the UK government. The deals are expected to give its results a lift for several years.
"In addition to these contracts, orders in the energy sector have again been robust. Aerospace revenues were at record levels in the period. In the US the integration of Chand Eisenmann into our operations is going as planned and like for like revenue growth was 15%. Order books for the second half are healthy," it said of the microfiltration unit.
Porvair is expanding its microfiltration business to meet the demand. It has bought a new facility in New Milton in the UK which it expects to have up and running by the end of 2014, and also expects to finish expanding its plant in Maine in the US in early 2015. In particular, it wants more capacity to meet recent strong aviation sector sales.
In its metals filtration unit, market share gains from patented filter products are continuing to drive growth, it said, while its is also making incremental product improvements to broaden their potential applications.
"Metals Filtration's revenue in China has been satisfactory and is expected to grow in the second half. The new plant, opened at the end of last year, is running well and we will consider further expansion later in the year," it said.
Still, Porvair shares were down 2.8% at 316 pence Monday morning. The company had flagged the results in a trading update in early June.