TIDMWEIR
RNS Number : 8147H
Weir Group PLC
01 August 2023
Very strong execution and positive book-to-bill
Upgrade to full year revenue and profit guidance
Strong demand for Weir mining equipment
-- H1 Group OE orders(1) , +5%; brownfield and sustainability projects driving demand
-- Strengthened pipeline for sustainable solutions, including Redefined Mill Circuit
H1 Group AM orders(1) +1%; Minerals AM orders(1) +5%
-- Positive mining production trends and installed base growth
-- H1 ESCO orders(1) -3%; robust demand in mining offset by infrastructure, as expected
Very strong execution; book-to-bill, 1.03
-- Revenue(1) , +16%, delivering on record opening order book
-- Adjusted operating profit(1,3) of GBP212m, +22%
-- Operating margin(1,3) of 16.3%, +80bps
-- Free operating cash conversion of 51%, +22pp
Increasing balance sheet strength and returns
-- Net debt to EBITDA of 1.5x with fixed-rate long dated debt maturity profile
-- Return on capital employed of 16.3%, +390bps
-- Interim dividend of 17.8 pence per share, +32%
FY outlook: now expect strong growth in constant currency
revenue and operating profit
-- Operating profit towards the upper end of the current range of analysts' expectations*
-- On track to deliver operating margin target of 17%
-- Free operating cash conversion of 80% to 90%
As Constant
reported currency(1)
H1 2023 H1 2022 +/- +/-
=============================== ================ ================ =============== ===============
Continuing Operations(2)
=============================== ================ ================ =============== ===============
Orders(1) GBP1,336m GBP1,311m n/a +2%
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Revenue GBP1,300m GBP1,096m +19% +16%
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Adjusted operating profit(3) GBP212m GBP168m +26% +22%
=============================== ================ ================ =============== ===============
Adjusted operating margin(3) 16.3% 15.3% +100bps +80bps
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Adjusted profit before GBP188m GBP143m +32% n/a
tax(3)
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Statutory profit before GBP170m GBP126m +35% n/a
tax
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Adjusted earnings per share(3) 53.4p 40.5p +32% n/a
=============================== ================ ================ =============== ===============
Return on capital employed 16.3% 12.4% +390bps n/a
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Total Group
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Statutory profit after GBP126m GBP92m +37% n/a
tax
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Statutory earnings per
share 48.8p 35.6p +37% n/a
Free operating cash conversion 51% 29% +22pp n/a
=============================== ================ ================ ===============
Dividend per share 17.8p 13.5p +32% n/a
=============================== ================ ================ =============== ===============
Net debt(6) GBP842m GBP797m(5) -GBP45m n/a
=============================== ================ ================ =============== ===============
(*Company compiled consensus from 30 June 2023, Group Operating
Profit range of GBP428m to GBP464m. For all other footnotes see
page 4.)
Jon Stanton, Chief Executive Officer said:
"Weir has a compelling value creation opportunity underpinned by
the global energy transition and the benefits of our Performance
Excellence transformation programme.
Global decarbonisation is driving growth in demand for critical
energy-transition metals and our customers' focus on more
sustainable extraction and processing techniques necessitates the
adoption of new technologies. Weir's engineering capability,
leading brands and growing portfolio of sustainable solutions is
delivering on this need and enhancing our position as a supplier of
mission critical solutions and services to the mining industry. In
addition, Performance Excellence will deliver compounding benefits
as we optimise our business to deliver margin expansion and strong
cash conversion.
In the first half of the year we performed well, winning market
share, growing orders and executing strongly to deliver significant
growth in revenue and operating profit. With a positive
book-to-bill we enter the second half with a record order book,
excellent operating momentum and high activity levels in our mining
markets. After a strong performance in the first half we raise our
full year revenue and profit guidance, and have confidence in
meeting our 2023 margin and cash conversion targets."
A webcast of the management presentation will begin at 08:00
(BST) on 1 August 2023 at www.investors.weir . A recording of the
webcast will also be available at www.investors.weir .
CHIEF EXECUTIVE OFFICER'S REVIEW
Introduction
I'm delighted with our performance in the first half of the
year. We continued to make excellent progress and meet our
commitments to stakeholders as a high-quality mining focused
group.
We executed strongly, capitalising on our record opening order
book and maintaining the operating momentum we carried into the
year. We delivered significant year-on-year growth in revenue,
operating profit and cash generation, while also expanding our
operating margins and taking significant steps towards achieving
our full year target of 17%. We delivered differentiated technology
and solutions to help our customers with their biggest challenges,
culminating in market share gains and year-on-year order growth,
while also providing them with the essential spares and expendables
to keep their mines running.
We also made excellent strategic progress. We increased our
investment in projects on our technology roadmap, including the
field trials of our proprietary ore characterisation technology,
and built our sales pipeline for sustainable solutions, including
for our Redefined Mill Circuit and Motion Metrics (TM) offerings.
In addition, we initiated key projects in our Performance
Excellence transformation programme, which will support future
margin expansion. We also had our scope 1, 2 & 3 emissions
reduction targets approved by SBTi. On safety, our total incident
rate(4) (TIR) improved by 12% year-on-year to 0.29, with
particularly pleasing progress at ESCO where TIR reduced by
39%.
Overall, our performance across all metrics reflects the hard
work and dedication of Weir colleagues across the globe, and I'd
like to thank them for their commitment and contribution to our
success.
Looking ahead, the future for Weir is exciting and the long-term
structural growth opportunity for our business from decarbonisation
is clear. In addition, our Performance Excellence transformation
programme will optimise our business and create further value.
Together, these factors will deliver excellent outcomes for
stakeholders and underpin our ambition to outgrow our markets,
expand our margins, convert our earnings to cash, while remaining
resilient and doing the right thing for our people and the
planet.
Growth: Outgrowing our markets and maintaining positive
book-to-bill
Through the first half, our mining markets saw high levels of
activity. Market prices for our main commodity exposures of copper,
gold and iron were well above our customer's cost of production and
end market demand was high. While there is growing intent amongst
miners to develop large expansion projects, conversion of the
pipeline remains slow, so our customers met demand by maximising
production from existing assets; running equipment harder,
developing more complex and lower grade ore bodies and by
debottlenecking and driving efficiency in existing processes.
Ore production trends, coupled with the incremental AM demand
from recent OE installations, drove demand for our AM spares and
expendables. Customers ordered OE for debottlenecking and
brownfield expansion projects, choosing premium Weir solutions due
to their differentiated technology, lowest total cost of ownership
and sustainability benefits relative to competitor solutions.
Across OE and AM, demand was at high levels across most regions,
and was particularly high in Australasia and South America,
reflecting production trends and recent market share gains.
In infrastructure, demand in our largest market of North America
was stable through the period, though well below the peak in the
first half of last year. In European infrastructure markets, demand
continued to be subdued.
On a constant currency basis, the Group delivered year-on-year
order growth of 2%.
AM constant currency orders grew by 1%, with growth in demand in
both divisions from hard rock mining customers and a contribution
from pricing. This growth was partially offset, as expected, by
lower demand from ESCO's infrastructure customers and Canadian oil
sands customers in Minerals, together with the non-repeat of Russia
orders.
In OE, constant currency orders grew 5%. In Minerals we saw
growing demand for our mill circuit solutions, as we won market
share, and also in comminution where our offering continues to gain
traction. In ESCO, we saw very strong incremental demand for mining
attachments as we won market share.
Revenue was 16% higher on a constant currency basis. This
reflects strong execution, a record opening order book, which
included a particularly high level of orders from Canadian oil
sands customers, and realisation of prior year price increases. The
Group's book-to-bill was 1.03.
Margins and resilience: On track to deliver 17% operating margin
in 2023
The operating environment through the first half was stable, as
raw material prices steadied and freight availability improved.
While wage inflation persisted, our market leading positions and
brands enabled us to increase prices to maintain gross margins.
On a constant currency basis adjusted operating profit grew by
22% and adjusted operating margins were 16.3%, up 100bps on an as
reported basis. This improvement reflects strong operational
efficiency, a contribution from pricing and the non-repeat of
adverse transactional FX movements seen in the prior year,
partially offset by a movement in Minerals revenue mix towards
OE.
Performance Excellence will support margin expansion in the
second half and beyond, and we have strong conviction in achieving
our target of GBP30m of run-rate savings by 2025. In the first
half, we made good progress with a number of capacity optimisation
projects, including consolidation of our Minerals facilities in
North America and optimisation of our service centre footprint in
Australia. We also mobilised our transformation project management
office and made key appointments to the team that will deliver the
transition of our Finance, HR and IS&T activities to a Global
Business Services model. An exceptional charge of GBP8m has been
recognised in the period relating to Performance Excellence.
Returns: Strong growth in return on capital employed and interim
dividend
Free operating cash conversion was in line with expectations at
51%, and reflects typical seasonal working capital patterns, with
the outflow from the first half expected to largely unwind through
the second half. Our performance represents a significant 22
percentage point improvement on the prior year, with the comparator
being impacted by complexities in global supply chains and
logistics channels. We remain on track to deliver our full year
guidance of 80% to 90% free operating cash conversion.
Return on capital employed (ROCE) for the 12 months to the end
of June was 16.3%, an increase of 390bps relative to the same
measurement point in the prior year.
In June we made our debut in the Sterling denominated bond
market, placing GBP300m of five-year 6.875% Sustainability-Linked
Notes. The proceeds from the placement are for general corporate
purposes and to repay existing debt. The competitive pricing
reflects our recent upgrade to a full investment grade credit
rating, and the sustainability link demonstrates our commitment to
reducing our CO(2) emissions.
Reflecting high levels of confidence in our strategy and future
prospects, the Board has approved an interim dividend of 17.8 pence
per share ( 2022 : 13.5p ) . This is in line with our policy and
represents a 32% increase on the prior year. The interim dividend
will be paid on 3 November 2023 to Shareholders on the register on
6 October 2023.
Safety and sustainability: Good progress
On safety, we delivered a 12% year-on-year improvement with the
Group's TIR reducing to 0.29. This represents a further significant
step in our ambition to eliminate harm in our operations, and
follows the recent launch of our Zero Harm Behaviours
Framework.
In March we received SBTi approval of our absolute scope 1, 2
& 3 emissions reduction targets, and launched our first ever
Climate Transition Plan. Our work to quantify our scope 4 avoided
emissions, which is a key part of the journey to enabling us to
recognise green revenue, is also progressing well. The focus has
expanded to determine the avoided emissions from our full Redefined
Mill Circuit solution, with quantification of the benefits expected
to enhance our overall customer value proposition.
Outlook
Activity levels in our mining markets are strong. Customers are
focused on maximising ore production and on improving the
efficiency and sustainability of existing operations, which is
driving demand for our AM spares and expendables and brownfield OE
solutions.
With a positive book-to-bill we enter the second half of the
year with a record order book, and strong operating momentum. We
now expect to deliver strong growth in full year constant currency
revenue and operating profit, with operating profit towards the
upper end of the range of analysts' current expectations*. We
remain on track to deliver our 2023 target of 17% operating margin,
supported by operational efficiencies, further price realisation
and the early financial benefits of Performance Excellence. We
expect free operating cash conversion of between 80% and 90%.
Further out, the fundamentals for our business are highly
attractive. The long-term structural growth in mining, and our
technology led strategy, underpins our ambition to deliver
through-cycle mid-to-high single digit percentage revenue growth,
while our Performance Excellence programme will deliver compounding
benefits and support margin expansion above 17%. In addition, as
our capex returns to normal levels in FY24, we expect cash
conversion to increase to between 90% and 100%.
Notes:
The Group financial highlights and Divisional financial reviews
include a mixture of GAAP measures and those which have been
derived from our reported results in order to provide a useful
basis for measuring our operational performance. Adjusted results
are for continuing operations before adjusting items as presented
in the Consolidated Income Statement. Details of other alternative
performance measures are provided in note 2 of the Interim
Financial Statements contained in this press release.
1. 2022 restated at 2023 average exchange rates.
2. Continuing operations excludes the Oil & Gas Division
which was sold to Caterpillar Inc. in February 2021 and the Saudi
Arabian joint venture which was sold to Olayan Financing Company in
June 2021.
3. Profit figures before adjusting items. Continuing operations
statutory operating profit was GBP194m (2022: GBP151m). Total
operations operating cash flow (cash generated from operations)
excludes additional pension contributions, exceptional and other
adjusting cash items, and income tax paid. Total operations net
cash generated from operating activities was GBP109m (2022:
GBP36m).
4. As measured by Total Incident Rate (TIR) which represents the
rate of any incident that causes an employee, visitor, contractor,
or anyone working on behalf of Weir to require off-site medical
treatment per 200,000 hours worked.
5. Net Debt at 31 December 2022.
6. Refer to note 2 of the Interim Financial Statements contained
in this press release for further details of alternative
performance measures.
DIVISIONAL REVIEW - MINERALS
Minerals is a global leader in products and integrated solutions
for smart, efficient and sustainable processing in mining
markets.
2023 First half summary
-- AM orders(1) +5%; reflects mining production trends and installed base expansion
-- OE orders(1) +1%; demand for brownfield and sustainability solutions
-- Revenue(1) +20%; reflects strong execution and record opening order book
-- Book-to-bill of 1.03
2023 First half strategic review
Minerals made strong strategic progress in the first half,
further building its leadership position in the mill circuit,
booking orders for new sustainable technologies and launching its
latest digital solutions. Progress across all 4 pillars of the 'We
are Weir' strategic framework are outlined below.
People
On safety, Minerals total incident rate (TIR) for the period was
0.21 (2022: 0.15). The Division remains amongst the safest in its
sector, and is on a positive long-term trajectory towards its
ambition of zero harm.
The Division continued to invest in people development and
rolled-out a new training programme to its global sales team on the
Redefined Mill Circuit. The programme is supporting teams as they
promote the technology and respond to growing customer interest in
our new sustainable solutions .
Customer
Minerals continued to execute on key strategic growth
initiatives, and during the first half gained market share in our
core mill circuit product categories. We converted 100% of our
competitive field trials for large mill circuit pumps, and also
rolled-out our latest cyclone technology. A particular highlight
was at a large Brazilian iron ore mine, where we upgraded the
cyclones to our latest Cavex(R) 2.0 solution. The new cyclones,
which are Synertrex(R) enabled, have improved separation and
increased mineral recovery by more than 400,000 tonnes per
annum.
We also made good strategic progress in sustainable solutions,
and delivered year-on-year growth in comminution. New orders
included a pebble crushing plant for a large copper mine in South
America and a crushing solution for a potash mine in Canada.
First commercial production was achieved at the Iron Bridge
magnetite mine in Western Australia in the second quarter. The
GBP15m per annum High Pressure Grinding Rolls (HPGRs) service
contract and regular spares orders for other equipment will
commence in the fourth quarter.
Technology
We saw very encouraging interest from customers for our
Redefined Mill Circuit, securing orders from large copper mines in
South America for coarse particle flotation (CPF) pilot circuits,
in partnership with Eriez. Through this strategic alliance we have
integrated CPF technology with our latest generation Warman(R) mill
circuit pumps and Cavex(R) cyclones to provide significantly
improved recoveries and process efficiencies for our customers.
Once operational in the third quarter, these plants will be
important reference sites for the industry.
We also launched our new, proprietary digital intelli-solutions
for pumps, cyclones and HPGRs which, coupled with our Synertrex(R)
2.0 platform, captures critical machine health data and enables
remote condition monitoring.
We continued to invest in research and development of our core
technologies including new materials and polymers, and upgrades and
range expansions for our industry leading Warman(R) slurry
pumps.
Performance
The Division continued to focus on optimising its product
management and global fulfilment processes and appointed its first
Chief Operating Officer to accelerate that work. Progress in the
first half included the launch of a programme to review product
life cycle management and retire legacy product variants, with
initial product retirements achieved during the period. The
programme, in combination with benefits from our SAP ERP system,
will drive continued improvement in our inventory levels over
time.
There was also good progress on our sustainability strategy.
Solar generation capability was installed at our South African
facility, which will deliver reductions in our scope 1 & 2
emissions.
2023 First half financial review
Constant currency GBPm H1 2023 H1 2022(1) Growth(1) H2 2022(1)
----------------------------- ---------------- ---------------- --------------- ----------------
Orders OE 266 262 1% 293
Orders AM 714 681 5% 683
Orders Total 980 943 4% 976
----------------------------- ---------------- ---------------- --------------- ----------------
Revenue OE 262 198 32% 256
Revenue AM 688 592 16% 719
Revenue Total 950 790 20% 975
----------------------------- ---------------- ---------------- --------------- ----------------
Adjusted operating profit(2) 173 138 25% 186
Adjusted operating margin(2) 18.2% 17.5% +70 bps 19.0%
----------------------------- ---------------- ---------------- --------------- ----------------
Operating cash flow(2) 131 106 24% 280
----------------------------- ---------------- ---------------- --------------- ----------------
Book-to-bill 1.03 1.19 1.00
----------------------------- ---------------- ---------------- --------------- ----------------
1. 2022 restated at 2023 average exchange rates except for
operating cash flow.
2. Profit figures before adjusting items. Operating cash flow
(cash generated from operations) excludes additional pension
contributions, exceptional and other adjusting cash items, and
income tax paid. Refer to note 2 of the Interim Financial
Statements contained in this press release further details of
alternative performance measures.
Orders increased by 4% on a constant currency basis to GBP980m
(2022: GBP943m), and book-to-bill was 1.03 reflecting high levels
of activity in our mining markets. OE orders grew 1%, with
particularly strong growth in Q1 (+20%). The decrease in OE orders
in Q2 reflects order phasing. AM orders grew 5% reflecting volume
growth in hard rock mining and a contribution from pricing,
partially offset, as expected, by lower volumes from customers in
the Canadian oil sands and the non-repeat of orders from Russia.
Excluding orders from Russia from the prior year comparator, AM
orders were up 6%. In line with prior years, AM orders in Q2
included a number of multi-period orders. In the first half, AM
orders represented 73% of total orders (2022: 72%). In total,
mining end markets accounted for 76% of total orders (2022:
74%).
Revenue was 20% higher on a constant current basis at GBP950m
(2022: GBP790m) reflecting strong execution, delivery of our record
opening order book and a contribution from prior year price
increases. Revenue growth in North America was particularly high,
following a period of strong order growth in the Canadian oil sands
last year. Product mix moved towards OE, which represented 28% of
revenue, up from 25% in the prior period.
Adjusted operating profit(2) increased 25% on a constant
currency basis to GBP173m (2022: GBP138m) as the Division
maintained its gross margins, and benefited from increased volumes
and strong execution. Prior year operating profit included a GBP2m
adverse impact from transactional FX movements.
Adjusted operating margin(2) on a constant currency basis was
18.2% (2022: 17.5%). The year-on-year improvement of 70bps reflects
strong operational efficiency and non-repeat of the prior year
adverse transactional FX movement, partially offset by a movement
in revenue mix towards OE.
Operating cash flow(2) increased by 24% to GBP131m (2022:
GBP106m) reflecting growth in operating profit, partially offset by
a modest increase in working capital outflow to GBP75m (2022:
GBP67m). Working capital movements reflect an increase in inventory
to support growth in the order book, and a decrease in payables
which were elevated in the prior year due to the phasing of
purchases and temporary disruption in global supply chains.
DIVISIONAL REVIEW - ESCO
ESCO is a global leader in Ground Engaging Tools (G.E.T.),
attachments, and artificial intelligence and machine vision
technologies that optimise productivity for customers in global
mining and infrastructure markets.
2023 First half summary
-- Orders(1) -3%; robust demand from mining customers offset by trends in infrastructure
-- Very strong demand for mining attachments
-- Revenue(1) +6%; reflects strong execution
-- Book-to-bill of 1.02
2023 First half strategic review
ESCO made good strategic progress in the first half,
significantly improving safety performance, achieving key
technology milestones and wining significant market share in mining
attachments. Progress across all 4 pillars of the 'We are Weir'
strategic framework are outlined below.
People
On safety, ESCO's TIR for the period was 0.65 (2022: 1.06). The
significant improvement on the prior year reflects the strong and
continued focus on safety across the Division, and the embedding of
Weir safety culture and standards at Carriere Industrial Supply
(CIS now ESCO Sudbury), which was acquired in H1 2022.
As part of the ongoing emphasis on people development, the
Division ran a successful pilot of a new leadership foundations
programme which focuses on developing key skills for first-line
managers. The roll-out of the programme will continue during the
second half of the year.
Customer
During the period ESCO made further progress across its
strategic growth initiatives. The number of mines using Motion
Metrics(TM) AI-enabled vision technology increased, and new orders
in the first half included a package of 5 ShovelMetrics(TM) and 5
LoaderMetrics(TM) systems which will be deployed across all large
mining machines at an iron ore mine in Western Australia.
The Division made excellent progress in growing market share in
mining attachments, with a 37% year-on-year increase in orders. A
particular highlight included converting 4 cable shovel buckets
from competitor products to ESCO technology for a large North
American copper miner.
In addition, ESCO continued to expand its geographical reach
with the transition from third party distribution to our direct to
customer model in Scandinavia. The ESCO sales team is now
leveraging Minerals' existing footprint in the region to provide
enhanced sales and service to customers.
Technology
Field trials of our proprietary ore characterisation technology
were successfully completed during the first half. Tests enabled
critical data to be collected and validated the performance of the
technology in a real world environment. Development has progressed
to the next phase which is focused on exploring novel illumination
technologies to enhance minerals characterisation.
New Motion Metrics(TM) capabilities and functions were launched
during the period, including an upgraded lens cleaning solution
that enhances machine vision capability and improves response
times.
Other technology investments included development of a new
series of mining attachments that, once launched, will expand our
addressable market.
Performance
Construction of the Division's new foundry in Xuzhou, China,
remains on track with transition to the equipment installation
phase of the project expected later this year. First production
from the foundry is expected in 2024, followed by full production
in early 2025.
The Division continued to progress initiatives to reduce its
environmental impact and commenced new feasibility studies into
transitioning to renewable power at a number of its North American
facilities.
2023 First half financial review
Constant currency GBPm H1 2023 H1 2022(1) Growth(1) H2 2022(1)
----------------------------- ---------------- ---------------- --------------- ----------------
Orders OE 35 25 40% 19
Orders AM 321 343 -6% 323
Orders Total 356 368 -3% 342
----------------------------- ---------------- ---------------- --------------- ----------------
Revenue OE 28 17 60% 26
Revenue AM 322 314 3% 338
Revenue Total 350 331 6% 364
----------------------------- ---------------- ---------------- --------------- ----------------
Adjusted operating profit(2) 59 53 10% 57
Adjusted operating margin(2) 16.7% 16.1% +60 bps 15.7%
----------------------------- ---------------- ---------------- --------------- ----------------
Operating cash flow(2) 53 25 114% 68
----------------------------- ---------------- ---------------- --------------- ----------------
Book-to-bill 1.02 1.11 0.94
----------------------------- ---------------- ---------------- --------------- ----------------
1. 2022 restated at 2023 average exchange rates except for
operating cash flow.
2. Profit figures before adjusting items. Operating cash flow
(cash generated from operations) excludes additional pension
contributions, exceptional and other adjusting cash items, and
income tax paid. Refer to note 2 of the Interim Financial
Statements contained in this press release for further details of
alternative performance measures.
Orders decreased 3% on a constant currency basis to GBP356m
(2022: GBP368m). Year-on-year movements include growth in the
contribution from CIS, which was acquired in Q2 of the prior year,
robust underlying demand from customers in mining and a decrease in
demand from infrastructure customers relative to a very strong
prior year comparator. In mining, demand was particularly strong
for our mining attachments, which is reflected in OE order growth
of 40%. Notwithstanding this, at 90%, AM continues to account for
the vast majority of the Division's orders (2022: 93%). The
Division's book-to-bill was 1.02 , reflecting high levels of
activity in our mining markets. In total, mining end markets
accounted for 62% of total orders (2022: 58%).
Revenue increased 6% on a constant currency basis to GBP350m
(2022: GBP331m). This reflects strong execution and further price
realisation.
Adjusted operating profit (2) increased by 10% on a constant
currency basis to GBP 59 m (2022: GBP 53 m) as the Division
maintained its gross margins, and benefited from increased
volumes.
Adjusted operating margin(2) on a constant currency basis was
16.7%, +60 bps (2022: 16.1%), with the year-on-year improvement
reflecting strong operational efficiencies.
Operating cash flow(2) increased by 114% to GBP53m (2022:
GBP25m), reflecting growth in operating profit and a reduction in
working capital outflow to GBP15m (2022: GBP33m). Working capital
movements reflect a modest increase in inventory, a modest
reduction in receivables and a decrease in payables which were
elevated in the prior year due to the phasing of purchases and
temporary disruption in global supply chains.
GROUP FINANCIAL REVIEW
Constant currency(1) As reported
Continuing Operations GBPm H1 2023 H1 2022(1) Growth H1 2022 Growth
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Orders OE 301 287 5% n/a n/a
Orders AM 1,035 1,024 1% n/a n/a
Orders Total 1,336 1,311 2% n/a n/a
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Revenue OE 290 215 34% 214 35%
Revenue AM 1,010 906 12% 882 15%
Revenue Total 1,300 1,121 16% 1,096 19%
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Adjusted operating profit(2) 212 173 22% 168 26%
Adjusted operating margin(2) 16.3% 15.5% +80bps 15.3% +100bps
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Book-to-bill 1.03 1.17 n/a n/a n/a
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Total Group GBPm
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Operating cash flow(2) 173 n/a n/a 100 73%
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Free operating cash conversion 51% n/a n/a 29% +22pp
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Net debt 842 n/a n/a 797(3) -45
------------------------------- ---------------- ---------------- -------------- ---------------- --------------
1. 2022 restated at 2023 average exchange rates.
2. Profit figures before adjusting items. Operating cash flow
(cash generated from operations) excludes additional pension
contributions, exceptional and other adjusting cash items, and
income tax paid. Refer to note 2 of the Interim Financial
Statements contained in this press release for further details of
alternative performance measures.
3. Net Debt at 31 December 2022.
Continuing operations order input at GBP1,336m increased 2% on a
constant currency basis. Minerals orders were up 4%, with AM growth
up 5% reflecting growth in demand from customers in hard rock
mining and a contribution from pricing partially offset by loss of
Russia orders and normalisation of demand from customers in the
Canadian oil sands. OE solutions performed well against a strong
prior year. ESCO orders were down 3%, with a decrease in demand
from customers in infrastructure markets offsetting robust
underlying demand from mining customers. 77% of orders from
continuing operations related to aftermarket compared to 78% in the
prior year.
Continuing operations revenue of GBP1,300m increased 16% on a
constant currency basis, reflecting strong execution of the opening
order book, continued strength in mining markets and price
realisation. In Minerals revenue was 20% higher on a constant
currency basis at GBP950m (2022: GBP790m). ESCO increased 6% on a
constant currency basis to GBP350m (2022: GBP331m). Aftermarket
accounted for 78% of revenues from continuing operations, down from
81% in the prior year. Reported revenues increased 19%, benefiting
from a foreign exchange translation tailwind of GBP25m. Overall
book-to-bill at 1.03 reflects the continued strength in orders as
we executed on our record opening order book.
Continuing operations adjusted operating profit increased by
GBP44m (26%) to GBP212m on a reported basis (2022: GBP168m).
Excluding a GBP5m foreign currency translation tailwind, the
constant currency increase was GBP39m (22%).
As explained further in the Divisional reviews, Minerals
adjusted operating profit increased by 25% on a constant currency
basis to GBP173m (2022: GBP138m) and ESCO's adjusted operating
profit increased by 10% on a constant currency basis to GBP59m
(2022: GBP53m). Corporate costs of GBP20m (2022: GBP18m) are 10% up
on prior year mainly reflecting wage inflation.
Continuing operations adjusted operating margin of 16.3% is up
80bps versus last year on a constant currency basis and up 100bps
as reported. This increase is driven by higher volumes and
associated operating leverage, as well as positive pricing action.
This improvement is despite product mix moving slightly towards OE
(19% to 22%) for continuing operations. R&D as a percentage of
sales was 1.8%, down from 1.9% at December 2022, albeit spend
increased in absolute terms.
Continuing operations statutory operating profit for the period
of GBP194m was GBP43m favourable to the prior year, driven by the
increase in adjusted operating profit of GBP44m.
Continuing operations net finance costs were GBP24m (2022:
GBP25m) with the decrease mainly due to favourable other finance
costs resulting from the Group's net retirement benefit
surplus.
Continuing operations adjusted profit before tax was GBP188m
(2022: GBP143m), after a translational foreign exchange tailwind of
GBP5m. The statutory profit before tax from continuing operations
of GBP170m compares to GBP126m in 2022, the increase primarily due
to the increase in adjusted operating profit.
Continuing operations adjusted tax charge for the year of GBP50m
(2022: GBP38m) on profit before tax from continuing operations
(before adjusting items) of GBP188m (2022: GBP143m) represents an
adjusted effective tax rate (ETR) of 26.3% (2022: 26.4%). The
decrease mainly reflects the geographic mix of profits.
A tax credit of GBP6m has been recognised in relation to
continuing operations adjusting items (2022: GBP4m).
Continuing operations adjusting items increased to GBP18m (2022:
GBP17m). Intangibles amortisation decreased by GBP4m to GBP13m
(2022: GBP17m). Exceptional items totalled GBP1m (2022: GBP3m),
with initial costs relating to our Performance Excellence programme
of GBP8m, being largely offset by the reversal of provisions in
respect of the wind down of operations in Russia of GBP7m as
working capital recoveries have exceeded initial expectations.
Other adjusting items which relate solely to the Group's legacy
asbestos-related provisions in the period were a charge of GBP4m
(2022: credit GBP3m), primarily due to settlements in the period,
with the credit recognised in the prior year attributable to the
significant change in discount rates.
Statutory profit for the period after tax from total operations
of GBP126m (2022: GBP92m) reflects a GBP35m increase in profit from
continuing operations.
Adjusted earnings per share from continuing operations increased
by 32% to 53.4p (2022: 40.5p). Statutory reported earnings per
share from total operations is 48.8p (2022: 35.6p).
Cash flow and net debt
Cash generated from operations increased by GBP73m to GBP173m
(2022: GBP100m) in the period due to a combination of higher
operating profits and a reduced outflow from working capital in the
period of GBP88m (2022: GBP112m). As a result, working capital as a
percentage of sales decreased to 24% from 32% in the prior year,
remaining in line with December 2022, as working capital levels
normalised. Continuing operations utilised non-recourse invoice
discounting facilities of GBP40m (2022: GBP21m) compared to GBP45m
at December 2022. This is largely utilising facilities provided by
our customers to receive payment on reasonable terms in certain
geographies where custom dictates very extended payment terms.
Suppliers chose to utilise supply chain financing facilities of
GBP41m (2022: GBP50m) versus GBP54m at December 2022.
Net capital expenditure increased by GBP18m to GBP36m (2022:
GBP18m), mainly due to the construction of our new ESCO foundry in
China. Lease payments increased to GBP16m (2022: GBP14m), while the
purchase of shares for employee share plans decreased by GBP5m to
GBP15m (2022: GBP20m).
Free operating cash conversion (refer to note 2 of the Interim
Financial Statements) was 51% (2022: 29%) as a result of the
increased cash generated from operations and a reduced working
capital outflow.
Free cash flow (refer to note 2 of the Interim Financial
Statements) from total operations was an inflow of GBP24m (2022:
outflow of GBP24m). In addition to the movements noted above this
was primarily impacted by an increase in tax payments of GBP11m
reflecting increased profit levels.
Net debt increased by GBP45m to GBP842m (December 2022: GBP797m)
and includes GBP118m (December 2022: GBP115m) in respect of IFRS 16
'Leases'. Drivers of the increase in net debt include payment of
the final 2022 dividend of GBP50m, lease movement of GBP9m,
settlement of CIS deferred consideration of GBP1m, adverse
translational foreign exchange and non-cash movements of GBP4m,
plus exceptional items of GBP5m which include Performance
Excellence costs. These are partially offset by the free cash
inflow of GBP24m. Net debt to EBITDA on a lender covenant basis was
in line with December 2022 at 1.5x, compared to a covenant level of
3.5x.
In June 2023, the Group successfully completed the issue of
GBP300m five-year Sustainability-Linked Notes due to mature in June
2028, which includes a target to reduce scope 1&2 CO2 emissions
by 19.1% in absolute terms by 2026 from a 2019 baseline, consistent
with the Group's SBTi approved target of 30% reduction by the end
of 2030. In March 2023, the Group exercised the option to extend
its US$800m multi-currency revolving credit facility by one year
which will now mature in April 2028, with the option remaining to
extend for a further year. These new arrangements followed the
final US Private Placement settlement of GBP167m in February and
allowed the Group to cancel in June its GBP300m one year term loan
facility, obtained in January 2023. Overall these actions extended
the average tenor of the Group's debt financing while ensuring
there remains in place more than GBP800m of immediately available
liquidity.
Pensions
The IAS 19 funding position across the Group's legacy UK and
North American schemes reduced from a net surplus of GBP15m at 31
December 2022 to a net surplus of GBP9m at 30 June 2023. This is
primarily due to a GBP12m loss in the UK Main plan following a
pensioner buy-in, which results in 63% (December 2022: 39%) of the
Main scheme liabilities now being insured. Other movements relating
to net losses in UK assets and experience losses resulting from UK
inflation were offset by gains driven by higher UK discount rates
and a reduction in deficit across our North American plans. In
total, a charge of GBP17m (2022: credit of GBP76m) has been
recognised in the Consolidated Statement of Comprehensive
Income.
The strength of the funding position of the UK main scheme means
that additional pension cash contributions will reduce by GBP6m
from 2024.
Principal Risks and Uncertainties
The Board considers the Principal Risks and Uncertainties
affecting the business activities of the Group are:
Principal Risk Risk Trend from 2022 Annual Report
--------------------------------- ----------------------------------
1. Political and Social No change
--- ---------------------------- ----------------------------------
2. Technology No change
--- ---------------------------- ----------------------------------
3. Value Chain Excellence No change
--- ---------------------------- ----------------------------------
4. Safety, Health and No change
Wellbeing
--- ---------------------------- ----------------------------------
5. People No change
--- ---------------------------- ----------------------------------
6. Market No change
--- ---------------------------- ----------------------------------
7. Climate No change
--- ---------------------------- ----------------------------------
8. Competition No change
--- ---------------------------- ----------------------------------
9. Digital No change
--- ---------------------------- ----------------------------------
10. Information Security No change
and Cyber
--- ---------------------------- ----------------------------------
11. Ethics and Governance No change
--- ---------------------------- ----------------------------------
12. Infectious Disease/Pandemics No change
--- ---------------------------- ----------------------------------
Details of the Group's Principal Risks and Uncertainties are
unchanged since the publication of the 2022 Annual Report
except:
-- Covid-19 has been broadened to Infectious Disease/Pandemics
to reflect that, while the immediate risks posed by Covid-19 have
subsided, we recognise that we need to continue to monitor and
examine the changing health risk environment and the shifting
patterns of infectious disease and their threat to health more
widely.
Further details of the Group's policies on Principal Risks and
Uncertainties are contained within the Group's 2022 Annual Report,
a copy of which is available at www.annualreport.weir .
Enquiries:
Investors: Edward Pears +44(0)141 308 3725
------------------------------
Media: Sally Jones +44(0)141 308 3666
------------------------------
Citigate Dewe Rogerson: Kevin +44 (0) 207 638 9571
Smith Weir@citigatedewerogerson.com
Appendix 1 - 2022 / 2023 continuing operations (1) quarterly
order trends
Life-for-like
Reported growth growth(3)
------------- ------------------------------------------------------------------------------------------------ --------------------------------
2022 2022 2022 2022 2023 2023 2023 2023
Division Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2
------------- --------------- -------------- -------------- -------------- -------------- --------------- --------------- ---------------
Original
Equipment -18% -3% 13% 19% 20% -12% 20% -12%
Aftermarket 23% 18% 25% 6% 5% 5% 5% 5%
Minerals 9% 11% 21% 10% 9% 0% 9% 0%
------------- --------------- -------------- -------------- -------------- -------------- --------------- --------------- ---------------
Original
Equipment -17% 98% -6% 14% 39% 40% 38% 9%
Aftermarket 37% 19% 14% 1% -9% -4% -15% -2%
ESCO 32% 23% 13% 2% -6% 0% -12% -1%
------------- --------------- -------------- -------------- -------------- -------------- --------------- --------------- ---------------
Original
Equipment -17% 2% 12% 19% 22% -8% 22% -10%
Aftermarket 28% 18% 21% 5% 0% 2% -2% 3%
Continuing
Ops 15% 14% 19% 8% 4% 0% 3% 0%
------------- --------------- -------------- -------------- -------------- -------------- --------------- --------------- ---------------
Book-to-bill 1.22 1.13 1.02 0.95 1.04 1.01 1.04 1.01
------------- --------------- -------------- -------------- -------------- -------------- --------------- --------------- ---------------
Like-for-like
Quarterly orders (2) GBPm orders(2,3)
------------------- ----------------------------------- ---------------
2022 2022 2022 2022 2023 2023 2023 2023
Division Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2
------------------- ----- ---- ---- ---- ---- ---- ------- ------
Original Equipment 112 150 147 146 134 132 134 132
Aftermarket 319 362 339 344 335 379 335 379
Minerals 431 512 486 490 469 511 469 511
------------------- ----- ---- ---- ---- ---- ---- ------- ------
Original Equipment 10 15 11 8 14 21 14 16
Aftermarket 180 163 163 160 164 157 153 151
ESCO 190 178 174 168 178 178 167 167
------------------- ----- ---- ---- ---- ---- ---- ------- ------
Original Equipment 122 165 158 154 148 153 148 148
Aftermarket 499 525 502 504 499 536 488 530
Continuing Ops 621 690 660 658 647 689 636 678
------------------- ----- ---- ---- ---- ---- ---- ------- ------
1. Continuing operations excludes the Oil & Gas Division,
which was sold to Caterpillar Inc. in February 2021 and the
Saudi-Arabian joint venture which was sold in June 2021.
2. Restated at June 2023 average exchange rates.
3. Like-for-like excludes the impact of Carriere Industrial
Supply Limited acquired on 8 April 2022.
CONSOLIDATED INCOME STATEMENT
FOR THE 6 MONTHSED 30 JUNE 2023
Year ended
31 December 6 months ended 30 6 months ended 30
2022 June 2023 June 2022
Adjusting Adjusting
items items
Statutory Adjusted (note Statutory Adjusted (note Statutory
results results 5) results results 5) results
GBPm Notes GBPm GBPm GBPm GBPm GBPm GBPm
============ ======================= ===== ======== ========= ========= ======== ========= =========
Continuing operations
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
2,472.1 Revenue 3 1,299.8 - 1,299.8 1,095.5 - 1,095.5
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Operating profit
before share of
results of joint
305.0 ventures 210.3 (17.6) 192.7 166.5 (16.5) 150.0
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Share of results
2.5 of joint ventures 1.3 - 1.3 1.0 - 1.0
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
307.5 Operating profit 211.6 (17.6) 194.0 167.5 (16.5) 151.0
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
(51.0) Finance costs (31.1) - (31.1) (25.5) - (25.5)
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
3.7 Finance income 7.4 - 7.4 0.5 - 0.5
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Profit before
tax from continuing
260.2 operations 187.9 (17.6) 170.3 142.5 (16.5) 126.0
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Tax (expense)
(47.6) credit 6 (49.5) 5.9 (43.6) (37.6) 3.8 (33.8)
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Profit for the
period from continuing
212.6 operations 138.4 (11.7) 126.7 104.9 (12.7) 92.2
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
(Loss) profit
for the period
from discontinued
1.2 operations 7 - (0.4) (0.4) - - -
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Profit for the
213.8 period 138.4 (12.1) 126.3 104.9 (12.7) 92.2
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Attributable
to:
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Equity holders
213.4 of the Company 138.1 (12.1) 126.0 104.8 (12.7) 92.1
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Non-controlling
0.4 interests 0.3 - 0.3 0.1 - 0.1
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
213.8 138.4 (12.1) 126.3 104.9 (12.7) 92.2
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Earnings per
share 8
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Basic - total
82.5p operations 48.8p 35.6p
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Basic - continuing
82.0p operations 53.4p 48.9p 40.5p 35.6p
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Diluted - total
82.0p operations 48.4p 35.4p
------------ ----------------------- ----- -------- --------- --------- -------- --------- ---------
Diluted - continuing
81.5p operations 53.1p 48.5p 40.2p 35.4p
============ ----------------------- ----- -------- --------- --------- -------- --------- ---------
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE 6 MONTHSED 30 JUNE 2023
6 months 6 months
Year ended ended ended
31 December 30 June 30 June
2022 2023 2022
GBPm GBPm GBPm
=========== ============================================ ======== ========
213.8 Profit for the period 126.3 92.2
----------- -------------------------------------------- -------- --------
Other comprehensive (expense) income
----------- -------------------------------------------- -------- --------
(Losses) gains taken to equity on cash
- flow hedges (0.1) 0.2
----------- -------------------------------------------- -------- --------
Exchange (losses) gains on translation
223.1 of foreign operations (151.5) 220.3
----------- -------------------------------------------- -------- --------
Reclassification of foreign currency
translation reserve on sale of discontinued
0.1 operations - -
----------- -------------------------------------------- -------- --------
Exchange gains (losses) on net investment
(124.9) hedges 25.3 (117.2)
----------- -------------------------------------------- -------- --------
Reclassification adjustments on cash
0.5 flow hedges 0.4 (0.1)
----------- -------------------------------------------- -------- --------
Tax relating to other comprehensive
expense (income) to be reclassified
(0.1) in subsequent periods - (0.1)
----------- -------------------------------------------- -------- --------
Items that are or may be reclassified
98.7 to profit or loss in subsequent periods (125.9) 103.1
----------- -------------------------------------------- -------- --------
Other comprehensive (expense) income
not to be reclassified to profit or
loss in subsequent periods:
----------- -------------------------------------------- -------- --------
65.3 Remeasurements on defined benefit plans (17.0) 76.0
Tax relating to other comprehensive
expense (income) not to be reclassified
(16.3) in subsequent periods 4.3 (18.9)
----------- -------------------------------------------- -------- --------
Items that will not be reclassified
49.0 to profit or loss in subsequent periods (12.7) 57.1
----------- -------------------------------------------- -------- --------
147.7 Net other comprehensive (expense) income (138.6) 160.2
----------- -------------------------------------------- -------- --------
Total net comprehensive (expense) income
361.5 for the period (12.3) 252.4
----------- -------------------------------------------- -------- --------
Attributable to:
----------- -------------------------------------------- -------- --------
360.8 Equity holders of the Company (11.6) 251.7
----------- -------------------------------------------- -------- --------
0.7 Non-controlling interests (0.7) 0.7
----------- -------------------------------------------- -------- --------
361.5 (12.3) 252.4
----------- -------------------------------------------- -------- --------
Total net comprehensive (expense) income
for the year attributable to equity
holders of the Company
----------- -------------------------------------------- -------- --------
359.6 Continuing operations (11.2) 251.7
----------- -------------------------------------------- -------- --------
1.2 Discontinued operations (0.4) -
----------- -------------------------------------------- -------- --------
360.8 (11.6) 251.7
----------- -------------------------------------------- -------- --------
CONSOLIDATED BALANCE SHEET
AT 30 JUNE 2023
31 December 30 June 30 June
2022 2023 2022
GBPm Notes GBPm GBPm
=========== ==================================== ===== ======= =======
ASSETS
----------- ------------------------------------ ----- ------- -------
Non-current assets
----------- ------------------------------------ ----- ------- -------
462.2 Property, plant & equipment 461.0 450.8
----------- ------------------------------------ ----- ------- -------
1,409.9 Intangible assets 1,324.0 1,426.0
15.1 Investments in joint ventures 14.8 13.5
92.5 Deferred tax assets 74.7 29.6
----------- ------------------------------------ ----- ------- -------
76.8 Other receivables 69.2 85.0
----------- ------------------------------------ ----- ------- -------
50.0 Retirement benefit plan assets 14 38.7 59.2
----------- ------------------------------------ ----- ------- -------
- Derivative financial instruments 15 0.1 -
----------- ------------------------------------ ----- ------- -------
2,106.5 Total non-current assets 1,982.5 2,064.1
----------- ------------------------------------ ----- ------- -------
Current assets
----------- ------------------------------------ ----- ------- -------
679.1 Inventories 684.7 674.1
----------- ------------------------------------ ----- ------- -------
528.9 Trade & other receivables 518.8 545.3
----------- ------------------------------------ ----- ------- -------
8.9 Derivative financial instruments 15 5.9 7.4
----------- ------------------------------------ ----- ------- -------
41.3 Income tax receivable 43.7 35.5
----------- ------------------------------------ ----- ------- -------
691.2 Cash & short-term deposits 626.9 467.0
1,949.4 Total current assets 1,880.0 1,729.3
----------- ------------------------------------ ----- ------- -------
4,055.9 Total assets 3,862.5 3,793.4
----------- ------------------------------------ ----- ------- -------
LIABILITIES
----------- ------------------------------------ ----- ------- -------
Current liabilities
----------- ------------------------------------ ----- ------- -------
406.3 Interest-bearing loans & borrowings 13 259.3 323.6
----------- ------------------------------------ ----- ------- -------
623.5 Trade & other payables 557.4 532.0
----------- ------------------------------------ ----- ------- -------
13.2 Derivative financial instruments 15 7.1 10.4
----------- ------------------------------------ ----- ------- -------
7.4 Income tax payable 2.1 4.3
----------- ------------------------------------ ----- ------- -------
35.3 Provisions 12 42.0 28.6
1,085.7 Total current liabilities 867.9 898.9
----------- ------------------------------------ ----- ------- -------
Non-current liabilities
----------- ------------------------------------ ----- ------- -------
1,082.1 Interest-bearing loans & borrowings 13 1,209.7 1,104.3
----------- ------------------------------------ ----- ------- -------
1.0 Other payables - 1.0
----------- ------------------------------------ ----- ------- -------
- Derivative financial instruments 15 - 0.4
----------- ------------------------------------ ----- ------- -------
62.9 Provisions 12 56.4 65.6
----------- ------------------------------------ ----- ------- -------
51.4 Deferred tax liabilities 35.7 30.0
----------- ------------------------------------ ----- ------- -------
34.9 Retirement benefit plan deficits 14 29.6 34.8
----------- ------------------------------------ ----- ------- -------
1,232.3 Total non-current liabilities 1,331.4 1,236.1
----------- ------------------------------------ ----- ------- -------
2,318.0 Total liabilities 2,199.3 2,135.0
----------- ------------------------------------ ----- ------- -------
1,737.9 NET ASSETS 1,663.2 1,658.4
----------- ------------------------------------ ----- ------- -------
CAPITAL & RESERVES
----------- ------------------------------------ ----- ------- -------
32.5 Share capital 32.5 32.5
----------- ------------------------------------ ----- ------- -------
582.3 Share premium 582.3 582.3
----------- ------------------------------------ ----- ------- -------
332.6 Merger reserve 332.6 332.6
----------- ------------------------------------ ----- ------- -------
(14.3) Treasury shares (20.1) (16.6)
----------- ------------------------------------ ----- ------- -------
0.5 Capital redemption reserve 0.5 0.5
----------- ------------------------------------ ----- ------- -------
(108.5) Foreign currency translation reserve (233.7) (104.0)
----------- ------------------------------------ ----- ------- -------
1.9 Hedge accounting reserve 2.2 1.5
----------- ------------------------------------ ----- ------- -------
899.5 Retained earnings 956.9 818.0
----------- ------------------------------------ ----- ------- -------
1,726.5 Shareholders' equity 1,653.2 1,646.8
----------- ------------------------------------ ----- ------- -------
11.4 Non-controlling interests 10.0 11.6
----------- ------------------------------------ ----- ------- -------
1,737.9 TOTAL EQUITY 1,663.2 1,658.4
----------- ------------------------------------ ----- ------- -------
The financial statements were approved by the Board of Directors
and authorised for issue on 1 August 2023 .
JON STANTON JOHN HEASLEY
Director Director
CONSOLIDATED CASH FLOW STATEMENT
FOR THE 6 MONTHSED 30 JUNE 2023
6 months 6 months
Year ended ended ended
31 December 30 June 30 June
2022 2023 2022
GBPm Notes GBPm GBPm
=========== ========================================= ===== ======== ========
Total operations
----------- ----------------------------------------- ----- -------- --------
Cash flows from operating activities 16
----------- ----------------------------------------- ----- -------- --------
447.8 Cash generated from operations 172.9 100.2
----------- ----------------------------------------- ----- -------- --------
Additional pension contributions
(9.7) paid (7.7) (7.7)
----------- ----------------------------------------- ----- -------- --------
Exceptional and other adjusting
(14.2) cash items (5.2) (7.2)
----------- ----------------------------------------- ----- -------- --------
Exceptional cash items - acquired
(9.7) vendor liabilities - (8.9)
----------- ----------------------------------------- ----- -------- --------
(93.4) Income tax paid (51.1) (40.2)
----------- ----------------------------------------- ----- -------- --------
Net cash generated from operating
320.8 activities 108.9 36.2
=========== ========================================= ===== ======== ========
Cash flows from investing activities
----------- ----------------------------------------- ----- -------- --------
Acquisitions of subsidiaries, net
(15.2) of cash acquired 11 (1.0) (14.6)
Purchases of property, plant & equipment,
(56.1) net of grants received (33.8) (18.4)
----------- ----------------------------------------- ----- -------- --------
(6.6) Purchases of intangible assets (3.5) (2.6)
Other proceeds from sale of property,
plant & equipment and intangible
4.4 assets 1.0 2.7
----------- ----------------------------------------- ----- -------- --------
Disposals of discontinued operations,
net of cash disposed and disposal
(0.1) costs 16 (0.4) -
----------- ----------------------------------------- ----- -------- --------
Exceptional cash item - disposal
(2.0) of ESCO Russia - -
4.6 Interest received 6.3 1.6
----------- ----------------------------------------- ----- -------- --------
2.7 Dividends received from joint ventures 1.7 1.4
----------- ----------------------------------------- ----- -------- --------
(68.3) Net cash used in investing activities (29.7) (29.9)
=========== ========================================= ===== ======== ========
Cash flows from financing activities
822.8 Proceeds from borrowings 510.6 752.8
----------- ----------------------------------------- ----- -------- --------
(958.9) Repayments of borrowings (529.6) (863.5)
----------- ----------------------------------------- ----- -------- --------
(30.5) Lease payments (15.7) (14.0)
----------- ----------------------------------------- ----- -------- --------
Settlement of derivative financial
(0.3) instruments (0.2) 0.2
(49.9) Interest paid (30.6) (27.1)
Dividends paid to equity holders
(66.7) of the Company 9 (49.9) (31.8)
Dividends paid to non-controlling
(0.3) interests (0.7) (0.1)
----------- ----------------------------------------- ----- -------- --------
Purchase of shares for employee
(20.0) share plans (15.0) (20.0)
----------- ----------------------------------------- ----- -------- --------
(303.8) Net cash used in financing activities (131.1) (203.5)
----------- ----------------------------------------- ----- -------- --------
(51.3) Net decrease in cash & cash equivalents (51.9) (197.2)
----------- ----------------------------------------- ----- -------- --------
Cash & cash equivalents at the beginning
500.0 of the year 477.5 500.0
----------- ----------------------------------------- ----- -------- --------
28.8 Foreign currency translation differences (32.1) 31.1
----------- ----------------------------------------- ----- -------- --------
Cash & cash equivalents at the
477.5 end of the period 16 393.5 333.9
----------- ----------------------------------------- ----- -------- --------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE 6 MONTHSED 30 JUNE 2023
Attributable
Foreign to equity
Capital currency Hedge holders Non-
Share Share Merger Treasury redemption translation accounting Retained of the controlling Total
capital premium reserve shares reserve reserve reserve earnings Company interests equity
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
At 31 December
2021 32.5 582.3 332.6 (5.3) 0.5 (206.5) 1.5 705.9 1,443.5 11.0 1,454.5
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Profit for
the period - - - - - - - 92.1 92.1 0.1 92.2
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Gains taken
to equity
on cash flow
hedges - - - - - - 0.2 - 0.2 - 0.2
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Exchange gains
on translation
of foreign
operations - - - - - 219.7 - - 219.7 0.6 220.3
Exchange losses
on net
investment
hedges - - - - - (117.2) - - (117.2) - (117.2)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Reclassification
adjustments
on cash flow
hedges - - - - - - (0.1) - (0.1) - (0.1)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Remeasurements
on defined
benefit plans - - - - - - - 76.0 76.0 - 76.0
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Tax relating
to other
comprehensive
income - - - - - - (0.1) (18.9) (19.0) - (19.0)
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
Total net
comprehensive
income for
the period - - - - - 102.5 - 149.2 251.7 0.7 252.4
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Cost of
share-based
payments
inclusive
of tax charge - - - - - - - 3.4 3.4 - 3.4
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Dividends - - - - - - - (31.8) (31.8) - (31.8)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Purchase of
shares for
employee share
plans - - - (20.0) - - - - (20.0) - (20.0)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Dividends
to
non-controlling
interests - - - - - - - - - (0.1) (0.1)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Exercise of
share-based
payments - - - 8.7 - - - (8.7) - - -
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
At 30 June
2022 32.5 582.3 332.6 (16.6) 0.5 (104.0) 1.5 818.0 1,646.8 11.6 1,658.4
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
Attributable
Foreign to equity
Capital currency Hedge holders Non-
Share Share Merger Treasury redemption translation accounting Retained of the controlling Total
capital premium reserve shares reserve reserve reserve earnings Company interests equity
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
At 31 December
2022 32.5 582.3 332.6 (14.3) 0.5 (108.5) 1.9 899.5 1,726.5 11.4 1,737.9
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Profit for
the period - - - - - - - 126.0 126.0 0.3 126.3
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Losses taken
to equity
on cash flow
hedges - - - - - - (0.1) - (0.1) - (0.1)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Exchange losses
on translation
of foreign
operations - - - - - (150.5) - - (150.5) (1.0) (151.5)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Exchange gains
on net
investment
hedges - - - - - 25.3 - - 25.3 - 25.3
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Reclassification
adjustments
on cash flow
hedges - - - - - - 0.4 - 0.4 - 0.4
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Remeasurements
on defined
benefit plans - - - - - - - (17.0) (17.0) - (17.0)
Tax relating
to other
comprehensive
expense - - - - - - - 4.3 4.3 - 4.3
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
Total net
comprehensive
(expense)
income for
the period - - - - - (125.2) 0.3 113.3 (11.6) (0.7) (12.3)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Cost of
share-based
payments
inclusive
of tax charge - - - - - - - 3.2 3.2 - 3.2
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Dividends - - - - - - - (49.9) (49.9) - (49.9)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Purchase of
shares for
employee share
plans - - - (15.0) - - - - (15.0) - (15.0)
Dividends
to
non-controlling
interests - - - - - - - - - (0.7) (0.7)
Exercise of
share-based
payments - - - 9.2 - - - (9.2) - - -
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
At 30 June
2023 32.5 582.3 332.6 (20.1) 0.5 (233.7) 2.2 956.9 1,653.2 10.0 1,663.2
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
Attributable
Foreign to equity
Capital currency Hedge holders Non-
Share Share Merger Treasury redemption translation accounting Retained of the controlling Total
capital premium reserve shares reserve reserve reserve earnings Company interests equity
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
At 31 December
2021 32.5 582.3 332.6 (5.3) 0.5 (206.5) 1.5 705.9 1,443.5 11.0 1,454.5
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Profit for
the year - - - - - - - 213.4 213.4 0.4 213.8
Exchange gains
on translation
of foreign
operations - - - - - 222.8 - - 222.8 0.3 223.1
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Reclassification
of exchange
gains on
discontinued
operations - - - - - 0.1 - - 0.1 - 0.1
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Exchange losses
on net
investment
hedges - - - - - (124.9) - - (124.9) - (124.9)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Reclassification
adjustments
on cash flow
hedges - - - - - - 0.5 - 0.5 - 0.5
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Remeasurements
on defined
benefit plans - - - - - - - 65.3 65.3 - 65.3
Tax relating
to other
comprehensive
income - - - - - - (0.1) (16.3) (16.4) - (16.4)
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
Total net
comprehensive
income for
the year - - - - - 98.0 0.4 262.4 360.8 0.7 361.5
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Cost of
share-based
payments
inclusive
of tax credit - - - - - - - 8.9 8.9 - 8.9
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Dividends - - - - - - - (66.7) (66.7) - (66.7)
================= ======= ======= ======= ======== ========== =========== ========== ======== ============ =========== =======
Purchase of
shares for
employee share
plans - - - (20.0) - - - - (20.0) - (20.0)
Dividends
to
non-controlling
interests - - - - - - - - - (0.3) (0.3)
Exercise of
share-based
payments - - - 11.0 - - - (11.0) - - -
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
At 31 December
2022 32.5 582.3 332.6 (14.3) 0.5 (108.5) 1.9 899.5 1,726.5 11.4 1,737.9
----------------- ------- ------- ------- -------- ---------- ----------- ---------- -------- ------------ ----------- -------
1. Accounting policies
Basis of preparation
These interim financial statements are for the 6 month period
ended 30 June 2023 and have been prepared on the basis of the
accounting policies set out in the Group's 2022 Annual Report and
in accordance with UK-adopted IAS 34 'Interim financial reporting'
and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority.
These interim financial statements are unaudited but have been
reviewed by the auditors and their report to the Company is set out
on page 45. The information shown for the year ended 31 December
2022 does not constitute statutory accounts as defined in Section
435 of the Companies Act 2006 and has been extracted from the
Group's 2022 Annual Report which has been filed with the Registrar
of Companies. The report of the auditors on the financial
statements contained within the Group's 2022 Annual Report was
unqualified and did not contain a statement under either Section
498(2) or Section 498(3) of the Companies Act 2006. These interim
financial statements should be read in conjunction with the annual
consolidated financial statements for the year ended 31 December
2022, which were prepared in accordance with UK-adopted
International Accounting Standards in conformity with the
requirements of the Companies Act 2006.
Significant changes in the financial position and performance of
the Group during the reporting period have been discussed in the
Chief Executive Officer's Review and the Group Financial Review.
The principal activities of the Group are described in note 3.
The Weir Group PLC is a limited company, limited by shares,
incorporated in Scotland, United Kingdom and is listed on the
London Stock Exchange.
These interim financial statements are presented in Sterling.
All values are rounded to the nearest 0.1 million pounds (GBPm)
except where otherwise indicated.
These interim financial statements were approved by the Board of
Directors on 1 August 2023.
Going concern
These interim financial statements have been prepared on the
going concern basis.
As discussed more fully in the Chief Executive Officer's Review,
the Group has continued to make excellent progress as a
high-quality mining focused group. The Group has executed strongly,
capitalising on a record opening order book, and maintained
operating momentum. This has led to the Group delivering
significant year-on-year growth in revenue, operating profit and
cash generation, while also expanding operating margins.
As discussed in the Group Financial Review, the Group has
extended the maturity profile of its debt financing with the issue
of GBP300m five-year Sustainability-Linked Notes due to mature in
June 2028, and exercise of the one year extension of the revolving
credit facility to April 2028. This ensures the Group retains
substantial levels of liquidity over the medium-term.
While mining markets continue to show strength, there remains
macroeconomic and geopolitical uncertainty. Recognising these
uncertainties, the Group performed financial modelling of future
cash flows, which cover a period of 12 months from the approval of
the 2023 interim financial statements. The financial modelling
included reverse stress testing which focused on the level of
downside risk which would be required for the Group to breach its
current lending facilities and related financial covenants. The
review indicated that the Group continues to have sufficient
headroom on both lending facilities and related financial
covenants. The circumstances which would lead to a breach are not
considered plausible.
The Directors, having considered all available relevant
information, have a reasonable expectation that the Group has
adequate resources to continue to operate as a going concern.
Climate change
As well as considering the impact of climate change across our
business model, the Directors have considered the impact on the
interim financial statements in accordance with the Task Force on
Climate-related Financial Disclosures (TCFD) recommendations. These
considerations focused on similar areas to those disclosed in the
2022 Annual Report. There has not been a material impact on the
financial reporting judgements and estimates arising from our
considerations, consistent with our assessment that climate change
is not expected to have a detrimental impact on the viability of
the Group in the medium-term.
New accounting standards, amendments and interpretations
A number of new or amended accounting standards became
applicable for the current reporting period as listed below:
i) Amendments to IAS 1 - Classification of liabilities as
current or non-current;
ii) Narrow scope amendments to IAS 1, Practice statement 2 and
IAS 8;
iii) Amendment to IFRS 16 - Leases on sale and leaseback;
iv) Amendment to IAS 12 - Deferred tax related to assets and
liabilities arising from a single transaction; and
v) IFRS 17 'Insurance contracts' as amended in December
2021.
The above are not considered to have a material impact on the
consolidated financial statements of the Group.
On 23 May 2023, the IASB issued narrow-scope amendments to IAS
12. The amendments provide a temporary exception from the
requirement to recognise and disclose deferred taxes arising from
the substantively enacted tax law that implements the Pillar Two
model rules published by the OECD, including tax law that
implements qualified domestic minimum top-up taxes described in
those rules. The amendments to IAS 12 are required to be applied
immediately and retrospectively in accordance with IAS 8
'Accounting policies, changes in accounting estimates and errors',
including the requirement to disclose the fact that the exception
has been applied if the entity's income taxes will be affected by
substantively enacted tax law that implements the OECD's Pillar Two
model rules. The Group has prepared an accounting policy on the
recognition of deferred taxes arising from the Pillar Two model
rules as discussed in note 6.
Use of estimates and judgements
The preparation of interim financial statements, in conformity
with IFRS, requires management to make judgements that affect the
application of accounting policies and estimates that impact the
reported amounts of assets, liabilities, income and expense.
Management bases these judgements on a combination of past
experience, professional expert advice and other evidence that is
relevant to each individual circumstance. Actual results may differ
from these judgements and the resulting estimates, which are
reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the year in which the estimate is revised.
The areas of judgement and estimate identified in the
preparation of the consolidated financial statements for the year
ended 31 December 2022 continue to be relevant to the preparation
of these interim financial statements, with additional
consideration given to the following area.
Taxation (estimate)
Taxes on income in the interim periods are accrued using the tax
rate that would be applicable to expected total annual profit or
loss.
2. Alternative performance measures
The reported interim financial statements of The Weir Group PLC
have been prepared in accordance with UK-adopted International
Accounting Standards and with the requirements of the Companies Act
2006 as applicable to those companies reporting under those
standards. In measuring our performance, the financial measures
that we use include those which have been derived from our reported
results in order to eliminate factors which we believe distort
period-on-period comparisons. These are considered alternative
performance measures. This information, along with comparable GAAP
measurements, is useful to investors in providing a basis for
measuring our operational performance. Our management uses these
financial measures, along with the most directly comparable GAAP
financial measures, in evaluating our performance and value
creation. Alternative performance measures should not be considered
in isolation from, or as a substitute for, financial information in
compliance with GAAP. Alternative performance measures as reported
by the Group may not be comparable with similarly titled amounts
reported by other companies.
Below we set out our definitions of alternative performance
measures and provide reconciliations to relevant GAAP measures.
Adjusted results and adjusting items
The Consolidated Income Statement presents Statutory results,
which are provided on a GAAP basis, and Adjusted results
(non-GAAP), which are management's primary area of focus when
reviewing the performance of the business. Adjusting items
represent the difference between Statutory results and Adjusted
results and are defined within the accounting policies section of
our 2022 Annual Report. The accounting policy for Adjusting items
should be read in conjunction with this note. Details of each
adjusting item are provided in note 5. We consider this
presentation to be helpful as it allows greater comparability of
the operating performance of the business from period to
period.
EBITDA
EBITDA is operating profit from continuing operations, before
exceptional items, other adjusting items, intangibles amortisation,
and excluding depreciation of owned assets and right-of-use assets.
EBITDA is a widely used measure of a company's profitability of its
operations before any effects of indebtedness, taxes or costs
required to maintain its asset base. EBITDA is used in conjunction
with other GAAP and non-GAAP financial measures to assess our
operational performance. A reconciliation of EBITDA to the closest
equivalent GAAP measure, operating profit, is provided.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ====================================== ======== ============
Continuing operations
----------- -------------------------------------- -------- ------------
307.5 Operating profit 194.0 151.0
----------- -------------------------------------- -------- ------------
Adjusted for:
----------- -------------------------------------- -------- ------------
Exceptional and other adjusting
51.4 items (note 5) 4.6 (0.5)
----------- -------------------------------------- -------- ------------
35.9 Adjusting amortisation (note 5) 13.0 17.0
----------- -------------------------------------- -------- ------------
394.8 Adjusted operating profit 211.6 167.5
----------- -------------------------------------- -------- ------------
5.7 Non-adjusting amortisation 6.2 3.0
----------- -------------------------------------- -------- ------------
Adjusted earnings before interest,
400.5 tax and amortisation (EBITA) 217.8 170.5
----------- -------------------------------------- -------- ------------
Depreciation of owned property,
47.0 plant & equipment 20.4 22.7
----------- -------------------------------------- -------- ------------
Depreciation of right-of-use property,
31.4 plant & equipment 15.8 14.8
----------- -------------------------------------- -------- ------------
Adjusted earnings before interest,
tax, depreciation and amortisation
478.9 (EBITDA) 254.0 208.0
----------- -------------------------------------- -------- ------------
Operating cash flow (cash generated from operations)
Operating cash flow excludes additional pension contributions,
exceptional and other adjusting cash items and income tax paid.
This is a useful measure to view or assess the underlying cash
generation of the business from its operating activities. A
reconciliation to the GAAP measure 'Net cash generated from
operating activities' is provided in the Consolidated Cash Flow
Statement.
Free operating cash flow and free cash flow
Free operating cash flow (FOCF) is defined as operating cash
flow (cash generated from operations), adjusted for net capital
expenditure, lease payments, dividends received from joint ventures
and purchase of shares for employee share plans. FOCF provides a
useful measure of the cash flows generated directly from the
operational activities after taking into account other cash flows
closely associated with maintaining daily operations.
Free cash flow (FCF) is defined as FOCF further adjusted for net
interest, income taxes, settlement of derivative financial
instruments, additional pension contributions and non-controlling
interest dividends. FCF reflects an additional way of viewing our
available funds that we believe is useful to investors as it
represents cash flows that could be used for repayment of debt,
dividends, exceptional and other adjusting items, or to fund our
strategic initiatives, including acquisitions, if any.
The reconciliation of operating cash flows (cash generated from
operations) to FOCF and subsequently FCF is as follows.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ====================================== ======== ============
Operating cash flow (cash generated
447.8 from operations) 172.9 100.2
----------- -------------------------------------- -------- ------------
Net capital expenditure from purchase
& disposal of property, plant &
(58.3) equipment and intangibles (36.3) (18.3)
----------- -------------------------------------- -------- ------------
(30.5) Lease payments (15.7) (14.0)
----------- -------------------------------------- -------- ------------
2.7 Dividends received from joint ventures 1.7 1.4
----------- -------------------------------------- -------- ------------
Purchase of shares for employee
(20.0) share plans (15.0) (20.0)
----------- -------------------------------------- -------- ------------
341.7 Free operating cash flow (FOCF) 107.6 49.3
----------- -------------------------------------- -------- ------------
(45.3) Net interest paid (24.3) (25.5)
----------- -------------------------------------- -------- ------------
(93.4) Income tax paid (51.1) (40.2)
----------- -------------------------------------- -------- ------------
Settlement of derivative financial
(0.3) instruments (0.2) 0.2
----------- -------------------------------------- -------- ------------
Additional pension contributions
(9.7) paid (7.7) (7.7)
----------- -------------------------------------- -------- ------------
Dividends paid to non-controlling
(0.3) interests (0.7) (0.1)
----------- -------------------------------------- -------- ------------
192.7 Free cash flow (FCF) 23.6 (24.0)
----------- -------------------------------------- -------- ------------
Free operating cash conversion
Free operating cash conversion is a non-GAAP key performance
measure defined as free operating cash flow divided by adjusted
operating profit on a total Group basis. The measure is used by
management to monitor the Group's ability to generate cash relative
to operating profits.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ================================= ========== ============
394.8 Continuing operations 211.6 167.5
Adjusted operating profit - Total
394.8 Group 211.6 167.5
----------- --------------------------------- ---------- ------------
341.7 Free operating cash flow (FOCF) 107.6 49.3
----------- --------------------------------- ---------- ------------
Free operating cash conversion
87% % 51% 29%
----------- --------------------------------- ---------- ------------
Working capital as a percentage of sales
Working capital as a percentage of sales is calculated based on
working capital as reflected below, divided by revenue for the last
12 months, as included in the Consolidated Income Statement. It is
a measure used by management to monitor how efficiently the Group
is managing its investment in working capital relative to revenue
growth.
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== =================================== ========== ============
Working capital as included in
the Consolidated Balance Sheet
----------- ----------------------------------- ---------- ------------
76.8 Other receivables 69.2 85.0
----------- ----------------------------------- ---------- ------------
679.1 Inventories 684.7 674.1
----------- ----------------------------------- ---------- ------------
528.9 Trade & other receivables 518.8 545.3
----------- ----------------------------------- ---------- ------------
Derivative financial instruments
(4.3) (note 15) (1.1) (3.4)
----------- ----------------------------------- ---------- ------------
(623.5) Trade & other payables (557.4) (532.0)
----------- ----------------------------------- ---------- ------------
(1.0) Other payables - (1.0)
----------- ----------------------------------- ---------- ------------
656.0 714.2 768.0
----------- ----------------------------------- ---------- ------------
Adjusted for:
----------- ----------------------------------- ---------- ------------
(77.9) Insurance contract assets (68.5) (86.3)
----------- ----------------------------------- ---------- ------------
5.3 Interest accruals 4.2 4.7
----------- ----------------------------------- ---------- ------------
2.0 Deferred consideration 1.0 2.5
----------- ----------------------------------- ---------- ------------
(70.6) (63.3) (79.1)
----------- ----------------------------------- ---------- ------------
585.4 Working capital 650.9 688.9
----------- ----------------------------------- ---------- ------------
H2 revenue as reported in the prior
year 1,376.6 1,033.2
----------- ----------------------------------- ---------- ------------
H1 revenue as reported 1,299.8 1,095.5
----------- ----------------------------------- ---------- ------------
2,472.1 Revenue 2,676.4 2,128.7
----------- ----------------------------------- ---------- ------------
Working capital as a percentage
24% of sales 24% 32%
----------- ----------------------------------- ---------- ------------
Net debt
Net debt is a widely used liquidity metric calculated by taking
cash and cash equivalents less total current and non-current debt.
A reconciliation of net debt to cash and short-term deposits and
interest-bearing loans and borrowings is provided in note 16. It is
a useful measure used by management and investors when monitoring
the capital management of the Group. Net debt, excluding lease
liabilities and converted at the exchange rates used in the
preparation of the Consolidated Income Statement, is also the basis
for covenant reporting.
3. Segment information
Continuing operations includes two operating Divisions: Minerals
and ESCO. These two Divisions are organised and managed separately
based on the key markets served and each is treated as an operating
segment and a reportable segment under IFRS 8 'Operating segments'.
The operating and reportable segments were determined based on the
reports reviewed by the Chief Executive Officer, which are used to
make operational decisions.
The Minerals segment is a global leader in engineering,
manufacturing and service processing technology used in abrasive,
high-wear mining applications. Its differentiated technology is
also used in infrastructure and general industrial markets. The
ESCO segment is a global leader in the provision of Ground Engaging
Tools (G.E.T.) for large mining machines. It operates predominantly
in mining and infrastructure markets where its highly engineered
technology improves productivity through extended wear life,
increased safety and reduced energy consumption.
Following the acquisition of Motion Metrics on 30 November 2021
and Carriere Industrial Supply Limited (CIS) on 8 April 2022, these
entities have been included in the ESCO segment. Motion Metrics is
a mining technology business, which is the market-leading developer
of innovative artificial intelligence (AI) and 3D rugged Machine
Vision Technology, used in mines worldwide. CIS is a premier
manufacturer and distributor of highly engineered wear parts and
aftermarket service provider to the Canadian mining industry.
The Chief Executive Officer assesses the performance of the
operating segments based on operating profit from continuing
operations before exceptional and other adjusting items ('segment
result'). Finance income and expenditure and associated
interest-bearing liabilities and financing derivative financial
instruments are not allocated to segments as all treasury activity
is managed centrally by the Group Treasury function. The amounts
provided to the Chief Executive Officer with respect to assets and
liabilities are measured in a manner consistent with that of the
financial statements. The assets are allocated based on the
operations of the segment and the physical location of the asset.
The liabilities are allocated based on the operations of the
segment.
Transfer prices between business segments are set on an arm's
length basis, in a manner similar to transactions with third
parties.
The segment information for the reportable segments for 2023 and
2022 is disclosed below.
Total continuing
Minerals ESCO operations
---------------- ---------------- ------------------
30 June 30 June 30 June 30 June 30 June 30 June
2023 2022 2023 2022 2023 2022
GBPm GBPm GBPm GBPm GBPm GBPm
=================================== ======= ======= ======= ======= ======== ========
Revenue
----------------------------------- ------- ------- ------- ------- -------- --------
Sales to external customers 950.0 782.0 349.8 313.5 1,299.8 1,095.5
----------------------------------- ------- ------- ------- ------- -------- --------
Inter-segment sales 0.1 - 1.6 1.2 1.7 1.2
----------------------------------- ------- ------- ------- ------- -------- --------
Segment revenue 950.1 782.0 351.4 314.7 1,301.5 1,096.7
Eliminations (1.7) (1.2)
-------- --------
1,299.8 1,095.5
-------- --------
Sales to external customers - 2022 at 2023 average exchange rates
-------------------------------------------------------------------------------------------
Sales to external customers 950.0 790.3 349.8 330.5 1,299.8 1,120.8
----------------------------------- ------- ------- ------- ------- -------- --------
Segment result
----------------------------------- ------- ------- ------- ------- -------- --------
Segment result before share
of results of joint ventures 173.3 135.1 57.2 49.5 230.5 184.6
----------------------------------- ------- ------- ------- ------- -------- --------
Share of results of joint ventures - - 1.3 1.0 1.3 1.0
----------------------------------- ------- ------- ------- ------- -------- --------
Segment result 173.3 135.1 58.5 50.5 231.8 185.6
----------------------------------- ------- ------- ------- ------- -------- --------
Corporate expenses (20.2) (18.1)
-------- --------
Adjusted operating profit 211.6 167.5
-------- --------
Adjusting items (17.6) (16.5)
-------- --------
Net finance costs (23.7) (25.0)
-------- --------
Profit before tax from continuing
operations 170.3 126.0
-------- --------
Segment result - 2022 at 2023 average exchange rates
Segment result before share
of results of joint ventures 173.3 138.2 57.2 52.2 230.5 190.4
----------------------------------- ------- ------- ------- ------- -------- --------
Share of results of joint ventures - - 1.3 1.1 1.3 1.1
----------------------------------- ------- ------- ------- ------- -------- --------
Segment result 173.3 138.2 58.5 53.3 231.8 191.5
----------------------------------- ------- ------- ------- ------- -------- --------
Corporate expenses (20.2) (18.3)
-------- --------
Adjusted operating profit 211.6 173.2
-------- --------
Minerals ESCO Total Group
---------------- ---------------- ----------------
30 June 30 June 30 June 30 June 30 June 30 June
2023 2022 2023 2022 2023 2022
GBPm GBPm GBPm GBPm GBPm GBPm
============================ ======= ======= ======= ======= ======= =======
Assets & liabilities
---------------------------- ------- ------- ------- ------- ------- -------
Intangible assets 562.9 606.6 761.1 818.6 1,324.0 1,425.2
---------------------------- ------- ------- ------- ------- ------- -------
Property, plant &
equipment 301.9 297.5 149.0 142.5 450.9 440.0
---------------------------- ------- ------- ------- ------- ------- -------
Working capital assets 906.5 905.7 294.8 310.5 1,201.3 1,216.2
---------------------------- ------- ------- ------- ------- ------- -------
1,771.3 1,809.8 1,204.9 1,271.6 2,976.2 3,081.4
---------------------------- ------- ------- ------- ------- ------- -------
Investments in joint
ventures - - 14.8 13.5 14.8 13.5
---------------------------- ------- ------- ------- ------- ------- -------
Segment assets 1,771.3 1,809.8 1,219.7 1,285.1 2,991.0 3,094.9
Corporate assets 871.5 698.5
------- -------
Total assets 3,862.5 3,793.4
------- -------
Working capital liabilities 467.6 449.9 122.5 140.9 590.1 590.8
---------------------------- ------- ------- ------- ------- ------- -------
Segment liabilities 467.6 449.9 122.5 140.9 590.1 590.8
---------------------------- ------- ------- ------- ------- ------- -------
Corporate liabilities 1,609.2 1,544.2
------- -------
Total liabilities 2,199.3 2,135.0
------- -------
Corporate assets primarily comprise cash and short-term
deposits, asbestos-related insurance asset, Trust Owned Life
Insurance policy investments, derivative financial instruments,
income tax receivable, deferred tax assets and elimination of
intercompany assets as well as those assets which are used for
general head office purposes. Corporate liabilities primarily
comprise interest-bearing loans and borrowings and related interest
accruals, derivative financial instruments, income tax payable,
provisions, deferred tax liabilities, elimination of intercompany
liabilities and retirement benefit deficits as well as liabilities
relating to general head office activities.
Geographical information
Geographical information in respect of revenue and non-current
assets for 2023 and 2022 is disclosed below. Revenues are allocated
based on the location to which the product is shipped.
Middle
Asia South East Europe
UK US Canada Pacific Australasia America & Africa & FSU Total
============================
6 months ended 30
June 2023 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
============================ ==== ===== ====== ======== =========== ======== ========= ====== =======
Revenue from continuing
operations
Sales to external customers 12.1 209.8 210.1 167.5 196.9 284.7 151.9 66.8 1,299.8
---------------------------- ---- ----- ------ -------- ----------- -------- --------- ------ -------
Middle
Asia South East Europe
UK US Canada Pacific Australasia America & Africa & FSU Total
============================
6 months ended 30 June
2022 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
============================ ==== ===== ====== ======== =========== ======== ========= ====== =======
Revenue from continuing
operations
Sales to external customers 14.5 190.6 160.6 135.2 133.8 235.8 131.6 93.4 1,095.5
---------------------------- ---- ----- ------ -------- ----------- -------- --------- ------ -------
Middle
Asia South East Europe
UK US Canada Pacific Australasia America & Africa & FSU Total
============================
Year ended 31 December
2022 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
============================ ==== ===== ====== ======== =========== ======== ========= ====== =======
Revenue from continuing
operations
Sales to external customers 34.8 418.1 378.3 288.2 336.3 540.8 295.3 180.3 2,472.1
---------------------------- ---- ----- ------ -------- ----------- -------- --------- ------ -------
Total continuing
Minerals ESCO operations
Year ended 31 December 2022 GBPm GBPm GBPm
=================================== ======== ===== ================
Revenue
----------------------------------- -------- ----- ----------------
Sales to external customers 1,780.5 691.6 2,472.1
----------------------------------- -------- ----- ----------------
Inter-segment sales 0.1 3.2 3.3
----------------------------------- -------- ----- ----------------
Segment revenue 1,780.6 694.8 2,475.4
----------------------------------- -------- ----- ----------------
Eliminations (3.3)
----------------
2,472.1
----------------
Sales to external customers - 2022 at 2023
average exchange rates
----- ----------------
Sales to external customers 1,765.4 694.0 2,459.4
----------------------------------- -------- ----- ----------------
Segment result
----------------------------------- -------- ----- ----------------
Segment result before share of
results of joint ventures 323.5 107.5 431.0
----------------------------------- -------- ----- ----------------
Share of results of joint ventures - 2.5 2.5
----------------------------------- -------- ----- ----------------
Segment result 323.5 110.0 433.5
----------------------------------- -------- ----- ----------------
Corporate expenses (38.7)
----------------
Adjusted operating profit 394.8
----------------
Adjusting items (87.3)
----------------
Net finance costs (47.3)
----------------
Profit before tax from continuing
operations 260.2
----------------
Segment result - 2022 at 2023
average exchange rates
----------------------------------- -------- ----- ----------------
Segment result before share of
results of joint ventures 323.8 107.9 431.7
----------------------------------- -------- ----- ----------------
Share of results of joint ventures - 2.5 2.5
----------------------------------- -------- ----- ----------------
Segment result 323.8 110.4 434.2
----------------------------------- -------- ----- ----------------
Corporate expenses (38.8)
----------------
Adjusted operating profit 395.4
----------------
Minerals ESCO Total Group
==============================
Year ended 31 December 2022 GBPm GBPm GBPm
============================== ======== ======= ===========
Assets & liabilities
------------------------------ -------- ------- -----------
Intangible assets 600.8 809.0 1,409.8
------------------------------ -------- ------- -----------
Property, plant & equipment 303.4 147.6 451.0
------------------------------ -------- ------- -----------
Working capital assets 902.0 307.3 1,209.3
------------------------------ -------- ------- -----------
1,806.2 1,263.9 3,070.1
------------------------------ -------- ------- -----------
Investments in joint ventures - 15.1 15.1
Segment assets 1,806.2 1,279.0 3,085.2
Corporate assets 970.7
-----------
Total assets 4,055.9
-----------
Working capital liabilities 543.7 139.9 683.6
Segment liabilities 543.7 139.9 683.6
Corporate liabilities 1,634.4
-----------
Total liabilities 2,318.0
-----------
The following disclosures are given in relation to continuing
operations.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== =================================== ======== ============
An analysis of the Group's revenue
is as follows:
----------- ----------------------------------- -------- ------------
456.0 Original equipment 247.6 202.4
----------- ----------------------------------- -------- ------------
1,825.7 Aftermarket parts 933.0 813.6
----------- ----------------------------------- -------- ------------
2,281.7 Sales of goods 1,180.6 1,016.0
----------- ----------------------------------- -------- ------------
141.9 Provision of services - aftermarket 75.5 68.3
----------- ----------------------------------- -------- ------------
Construction contracts - original
45.5 equipment 41.7 11.2
----------- ----------------------------------- -------- ------------
3.0 Subscription services 2.0 -
----------- ----------------------------------- -------- ------------
2,472.1 Revenue 1,299.8 1,095.5
----------- ----------------------------------- -------- ------------
Total
continuing Total continuing
operations Minerals ESCO operations
---------------- ---------------- ------------------
31 December 30 June 30 June 30 June 30 June 30 June 30 June
2022 2023 2022 2023 2022 2023 2022
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
=========== ================== ======= ======= ======= ======= ======== ========
Timing of revenue
recognition
----------- ------------------ ------- ------- ------- ------- -------- --------
2,364.6 At a point in time 883.0 716.6 345.0 310.4 1,228.0 1,027.0
----------- ------------------ ------- ------- ------- ------- -------- --------
110.8 Over time 67.1 65.4 6.4 4.3 73.5 69.7
----------- ------------------ ------- ------- ------- ------- -------- --------
2,475.4 Segment revenue 950.1 782.0 351.4 314.7 1,301.5 1,096.7
----------- ------------------ ------- ------- ------- ------- -------- --------
(3.3) Eliminations (1.7) (1.2)
----------- -------- --------
2,472.1 1,299.8 1,095.5
----------- -------- --------
4. Revenue & expenses
The following disclosures are given in relation to continuing
operations.
Year ended
31 December 6 months ended 30 6 months ended 30
2022 June 2023 June 2022
Statutory Adjusted Adjusting Statutory Adjusted Adjusting Statutory
results results items results results items results
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
============ ======================= ======== ========= ========= ======== ========= =========
A reconciliation of
revenue to operating
profit is as follows:
------------ ----------------------- -------- --------- --------- -------- --------- ---------
2,472.1 Revenue 1,299.8 - 1,299.8 1,095.5 - 1,095.5
------------ ----------------------- -------- --------- --------- -------- --------- ---------
(1,598.2) Cost of sales (818.5) 5.4 (813.1) (692.4) (3.8) (696.2)
------------ ----------------------- -------- --------- --------- -------- --------- ---------
873.9 Gross profit 481.3 5.4 486.7 403.1 (3.8) 399.3
------------ ----------------------- -------- --------- --------- -------- --------- ---------
10.4 Other operating income 3.2 0.4 3.6 4.6 - 4.6
------------ ----------------------- -------- --------- --------- -------- --------- ---------
Selling & distribution
(284.0) costs (144.2) (1.0) (145.2) (133.4) (0.1) (133.5)
------------ ----------------------- -------- --------- --------- -------- --------- ---------
(295.3) Administrative expenses (130.0) (22.4) (152.4) (107.8) (12.6) (120.4)
------------ ----------------------- -------- --------- --------- -------- --------- ---------
Share of results of
2.5 joint ventures 1.3 - 1.3 1.0 - 1.0
------------ ----------------------- -------- --------- --------- -------- --------- ---------
307.5 Operating profit 211.6 (17.6) 194.0 167.5 (16.5) 151.0
------------ ----------------------- -------- --------- --------- -------- --------- ---------
Details of adjusting items are included in note 5.
5. Adjusting items
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ========================================= ======== ============
Recognised in arriving at operating
profit from continuing operations
----------- ----------------------------------------- -------- ------------
(35.9) Intangibles amortisation (13.0) (17.0)
----------- ----------------------------------------- -------- ------------
Exceptional items
----------- ----------------------------------------- -------- ------------
(44.0) Russia operations wind down 7.1 (1.7)
----------- ----------------------------------------- -------- ------------
(2.9) Performance Excellence programme (7.8) -
----------- ----------------------------------------- -------- ------------
Acquisition and integration related
(2.4) costs (0.3) (1.3)
----------- ----------------------------------------- -------- ------------
Other restructuring and rationalisation
0.4 activities - 0.3
----------- ----------------------------------------- -------- ------------
(48.9) Total exceptional items (1.0) (2.7)
----------- ----------------------------------------- -------- ------------
Other adjusting items
----------- ----------------------------------------- -------- ------------
(2.5) Asbestos-related provision (3.6) 3.2
(2.5) Total other adjusting items (3.6) 3.2
----------- ----------------------------------------- -------- ------------
(87.3) Total adjusting items (17.6) (16.5)
----------- ----------------------------------------- -------- ------------
Continuing operations
Intangibles amortisation
Intangibles amortisation of GBP13.0m in the current period is in
respect of acquisition related assets. The prior period charge of
GBP17.0m includes both amortisation in respect of acquisition
related assets and intangible assets categorised as multi-year
investment activities which have now concluded.
Exceptional items
In the year ended 31 December 2022, a charge of GBP44.0m was
recognised in relation to the wind down of Russia operations. The
loss on disposal of the ESCO Russia operations totalled GBP4.9m.
Due to the tightening of sanctions giving rise to increased
uncertainty over recoverability of assets, costs of GBP39.1m were
recognised in the Minerals Division. This represented provision for
the majority of Weir Minerals Russia's closing third-party net
assets of GBP25.4m, as well as other provisions across the Minerals
Division, including provision for made to order inventory
prohibited from being shipped of GBP7.0m, receivables from
sanctioned customers of GBP2.8m, and severance and incremental
warehousing costs totalling GBP3.9m. This led to a cash outflow of
GBP1.2m in the period, primarily related to severance. A net credit
of GBP7.1m has been recognised in the Consolidated Income Statement
in the period in respect of the reversal of previously impaired
inventory and receivables, partially offset by additional provision
for newly emerging contract exposures.
A charge of GBP7.8m has been recognised in the period in
relation to the Group's Performance Excellence programme. The
three-year programme aims to transform the way we work with more
agile and efficient business processes, with a focus on customer
and service-delivery. The programme includes capacity optimisation,
lean processes and global business services. Costs of GBP5.1m,
primarily relating to severance, have been recognised under the
capacity optimisation pillar of the programme in relation to the
relocation of facilities in the US and service centre restructuring
in Australia. Of these costs GBP2.3m have been cash settled in the
period. The remaining costs of GBP2.7m have been recognised in
relation to the global business services pillar of the programme,
with GBP1.2m of this being cash settled in the period.
Exceptional items in the period include GBP0.3m (2022: GBP1.3m)
for integration related costs, following the acquisition of
Carriere Industrial Supply Limited and Motion Metrics, acquired on
8 April 2022 and 30 November 2021 respectively (note 11). Prior
period exceptional items also included GBP1.7m in relation to the
wind down of the Group's operations in Russia, primarily relating
to severance costs of GBP1.1m and a credit of GBP0.3m related to
the reversal of restructuring and rationalisation charges
recognised in Peru and China in prior years.
Other adjusting items
A charge of GBP3.6m (2022: credit of GBP3.2m) has been recorded
in respect of movements in the US and UK asbestos-related
liabilities and associated US insurance provision, plus settlements
for post-1981 US asbestos-related claims which relate to legacy
Group products. Further details of this are included in note
12.
Discontinued operations
A charge of GBP0.4m has been recognised in the period in
relation to the gain on sale of discontinued operations (note 7).
This relates to the finalisation of certain tax indemnities under
the sale and purchase agreement for the Oil & Gas Division,
which was disposed in 2021.
6. Income tax expense
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ====================================== ======== ============
(11.8) Continuing Group - UK (6.3) (5.7)
----------- -------------------------------------- -------- ------------
(35.8) Continuing Group - Overseas (37.3) (28.1)
----------- -------------------------------------- -------- ------------
Income tax expense in the Consolidated
Income Statement for continuing
(47.6) operations (43.6) (33.8)
----------- -------------------------------------- -------- ------------
1.2 Discontinued operations - -
----------- -------------------------------------- -------- ------------
Income tax expense in the Consolidated
(46.4) Income Statement for total operations (43.6) (33.8)
----------- -------------------------------------- -------- ------------
The total income tax expense is disclosed in the Consolidated
Income Statement as follows.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ====================================== ======== ============
Tax (expense) credit
----------- -------------------------------------- -------- ------------
(92.5) - adjusted continuing operations (49.5) (37.6)
----------- -------------------------------------- -------- ------------
1.2 - adjusted discontinued operations - -
----------- -------------------------------------- -------- ------------
- exceptional and other adjusting
36.3 items 3.1 (0.3)
----------- -------------------------------------- -------- ------------
- adjusting intangibles amortisation
8.6 and impairment 2.8 4.1
----------- -------------------------------------- -------- ------------
Total income tax expense in the
Consolidated Income Statement for
(46.4) total operations (43.6) (33.8)
----------- -------------------------------------- -------- ------------
The income tax expense included in continuing operations' share
of results of joint ventures is as follows.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ============== ======== ============
(0.2) Joint ventures - -
----------- -------------- -------- ------------
Tax charged within the 6 months ended 30 June 2023 has been
calculated by applying the effective rate of tax which is expected
to apply to the Group for the year ending 31 December 2023 using
rates substantively enacted by 30 June 2023 as required by IAS 34
'Interim financial reporting'.
The normalised rate of tax of 26.3% (June 2022: 26.4%) has been
calculated using the full year projections and has been applied to
profit before adjusting items for the 6 months ended 30 June
2023.
Legislation to increase the UK corporation tax rate from 19% to
25% from April 2023 was substantively enacted as part of Finance
Bill 2021 (on 25 May 2021). As a result, at 30 June 2022, deferred
tax balances have been calculated at 25%.
Factors affecting current and future tax charges
The normalised tax rate was 0.2% above the Group's weighted
average rate of 26.1%. The Group considers its normalised tax rate
to be sustainable.
Unrecognised deferred tax
Included in the net deferred tax asset of GBP39.0m (June 2022:
net liability GBP0.4m) is GBP52.0m (June 2022: GBP28.0m) related to
the US Group net deferred tax assets, determined on a basis
consistent with the approach adopted at year ended 31 December 2022
following the application of a model which estimates the future
forecast levels of US taxable income with reference to the Group's
five-year strategic plan. Consistent with this approach, US
deferred tax assets totalling GBP7.7m (June 2022: GBP53.0m) are not
recognised but retained by the continuing US group. The ongoing
application of this model may result in future changes to the
amount of US deferred tax assets that are unrecognised.
Pillar Two
During 2021, the Organisation for Economic Co-operation and
Development (OECD) published a framework for the introduction of a
global minimum effective tax rate of 15%, applicable to large
multinational groups. On 20 July 2022, HM Treasury released draft
legislation to implement these 'Pillar Two' rules with effect for
years beginning on or after 31 December 2023, and this was
substantively enacted as part of Finance (No.2) Bill 2023 on 20
June 2023. The Group does not account for deferred tax on top-up
taxes therefore there is no impact to deferred tax as a result of
these rules. The Group is reviewing the legislation to understand
any other potential impacts.
7. Discontinued operations
The Group disposed of the Oil & Gas Division (excluding the
Group's joint venture, Arabian Metals Company (AMCO)) on 1 February
2021 to Caterpillar Inc. (CAT). On 30 June 2021, the Group
completed the sale of the remaining Oil & Gas joint venture
AMCO to Olayan Financing Company (Olayan).
In the current period, a charge of GBP0.4m has been recognised
in relation to the finalisation of certain tax indemnities under
the sale and purchase agreement for the Oil & Gas Division. In
the year ended 31 December 2022, a current tax credit of GBP1.2m
was recognised in respect of Oil & Gas Division related
activity following the filing of the 2021 US tax return. Total
current year investing cash flows from discontinued operations
related to the charge in the period are GBP0.4m (2022: GBP0.1m
investing cash flows).
8. Earnings per share
Basic earnings per share amounts are calculated by dividing net
profit for the year attributable to equity holders of the Company
by the weighted average number of ordinary shares outstanding
during the year. Diluted earnings per share is calculated by
dividing the net profit attributable to equity holders of the
Company by the weighted average number of ordinary shares
outstanding during the year, adjusted for the effect of dilutive
share awards.
The following reflects the earnings used in the calculation of
earnings per share.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ====================================== ======== ============
Profit attributable to equity holders
of the Company
----------- -------------------------------------- -------- ------------
213.4 Total operations(1) 126.0 92.1
----------- -------------------------------------- -------- ------------
212.2 Continuing operations(1) 126.4 92.1
----------- -------------------------------------- -------- ------------
Continuing operations before adjusting
254.6 items(2) 138.1 104.8
----------- -------------------------------------- -------- ------------
The following reflects the number of shares used in the
calculation of earnings per share, and the difference between the
weighted average share capital for the purposes of the basic and
the diluted earnings per share calculations.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
Shares Shares Shares
million million million
=========== ==================================== ======== ============
Weighted average number of ordinary
258.7 shares for basic earnings per share 258.4 258.7
----------- ------------------------------------ -------- ------------
Effect of dilution: employee share
1.6 awards 1.8 1.8
----------- ------------------------------------ -------- ------------
Adjusted weighted average number
of ordinary shares for diluted
260.3 earnings per share 260.2 260.5
----------- ------------------------------------ -------- ------------
The profit attributable to equity holders of the Company used in
the calculation of both basic and diluted earnings per share from
continuing operations before adjusting items is calculated as
follows.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ====================================== ======== ============
Net profit attributable to equity
212.2 holders from continuing operations(2) 126.4 92.1
----------- -------------------------------------- -------- ------------
42.4 Adjusting items net of tax 11.7 12.7
----------- -------------------------------------- -------- ------------
Net profit attributable to equity
holders from continuing operations
254.6 before adjusting items 138.1 104.8
----------- -------------------------------------- -------- ------------
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
pence pence pence
=========== ======================================== ======== ============
Basic earnings per share:
----------- ---------------------------------------- -------- ------------
82.5 Total operations(1) 48.8 35.6
----------- ---------------------------------------- -------- ------------
82.0 Continuing operations(2) 48.9 35.6
----------- ---------------------------------------- -------- ------------
Continuing operations before adjusting
98.4 items(2) 53.4 40.5
----------- ---------------------------------------- -------- ------------
Diluted earnings per share:
----------- ---------------------------------------- -------- ------------
82.0 Total operations(1) 48.4 35.4
----------- ---------------------------------------- -------- ------------
81.5 Continuing operations(2) 48.5 35.4
----------- ---------------------------------------- -------- ------------
Continuing operations before adjusting
97.8 items(2) 53.1 40.2
----------- ---------------------------------------- -------- ------------
1 Adjusted for a profit of GBP0.3m (2022: profit of GBP0.1m) in
respect of non-controlling interests for both total and continuing
operations.
2 Adjusted for a profit of GBP0.3m (2022: profit of GBP0.1m) in
respect of non-controlling interests for continuing operations.
There have been no share awards (2022: 725) exercised between
the reporting date and the date of signing of these interim
financial statements. Those exercised in the prior year were
settled out of existing shares held in trust.
9. Dividends paid & proposed
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ==================================== ======== ============
Declared & paid during the year
----------- ------------------------------------ -------- ------------
Equity dividends on ordinary shares
----------- ------------------------------------ -------- ------------
Final dividend paid for 2022: 19.30p
31.8 (2021: 12.30p) 49.9 31.8
----------- ------------------------------------ -------- ------------
Interim dividend paid for 2022:
34.9 13.50p (2021: 11.50p) - -
----------- ------------------------------------ -------- ------------
Final dividend for 2022 proposed
for approval by shareholders at
49.9 the AGM (19.30p) - -
----------- ------------------------------------ -------- ------------
Interim dividend proposed for 2023:
- 17.80p (2022: 13.50p) 46.0 34.9
----------- ------------------------------------ -------- ------------
An interim dividend of 17.80p has been declared for 2023 ( 2022
: 13.50p) in line with the capital allocation policy under which
the Group intends to distribute 33% of earnings from continuing
operations before adjusting items by way of dividend.
The proposed interim dividend is based on the number of shares
in issue, excluding treasury shares held, at the date that the
financial statements were approved and authorised for issue. The
final interim dividend may differ due to increases or decreases in
the number of shares in issue between the date of approval of this
Interim Report and Financial Statements and the record date for the
interim dividend.
10. Property, plant & equipment and intangible assets
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ================================= ======== ============
Additions of property, plant &
equipment and intangible assets
----------- --------------------------------- -------- ------------
4.8 - owned land & buildings 0.4 2.3
----------- --------------------------------- -------- ------------
55.9 - owned plant & equipment 34.2 18.0
----------- --------------------------------- -------- ------------
24.9 - right-of-use land & buildings 20.2 17.8
----------- --------------------------------- -------- ------------
6.8 - right-of-use plant & equipment 3.5 2.1
----------- --------------------------------- -------- ------------
6.8 - intangible assets 3.5 2.5
----------- --------------------------------- -------- ------------
99.2 61.8 42.7
----------- --------------------------------- -------- ------------
The above additions relate to the normal course of business and
do not include any additions made by way of business combinations.
There have been no material disposals or transfers within the
period.
11. Business combinations
Carriere Industrial Supply Limited
On 8 April 2022, the Group completed the acquisition of 100% of
the voting rights of Carriere Industrial Supply Limited (CIS) for
an enterprise value of CAD$32.5m (GBP20.2m). The provisional fair
values reported at 30 June 2022 were revised in the second half of
2022 and included in the 2022 Annual Report as provisional. The
provisional adjustment resulted in a reduction to goodwill of
GBP1.7m. There have been no updates to these provisional fair
values, which were subject to finalisation in April 2023, 12 months
after the acquisition as permitted by IFRS 3 'Business
combinations'. Due to the immaterial value of the adjustment the
June 2022 comparatives have not been restated in these interim
financial statements. Detail of all adjustments can be found in the
2022 Annual Report and 2022 Interim Report.
Initial consideration of GBP16.2m was paid on completion, with a
further deferred consideration of GBP2.5m recognised reflecting
indemnification and working capital hold backs. In October 2022,
the Group paid a further GBP0.1m in relation to the finalisation of
the completion accounts process and settled GBP0.5m of the deferred
consideration in relation to the working capital completion. The
Group settled a further GBP1.0m of the deferred consideration in
April 2023, on the first anniversary of the acquisition date as per
the sale and purchase agreement. The remaining GBP1.0m balance will
be settled on the second anniversary of the acquisition date.
Motion Metrics
The Group completed the acquisition of 100% of the voting rights
of Motion Metrics on 30 November 2021 for an enterprise value of
CAD$150.0m (GBP88.7m). The final values in relation to the
acquisition balance sheet were reported in the 2022 Annual Report.
The adjustment to goodwill reported in the 2022 Annual Report was a
reduction of GBP0.5m from the June 2022 Interim Report. Due to the
immaterial value of this adjustment, the June 2022 comparatives
have not been restated in these interim financial statements.
As part of the purchase agreement a maximum of an additional
CAD$100m is payable by the Group contingent on Motion Metrics
exceeding specific revenue and EBITDA targets over the first three
years following acquisition. Any balance that becomes payable would
be split, with 80% reflecting further consideration and 20% for a
new employee bonus plan. The entry point for any contingent payment
would require significant growth both in terms of revenue and
EBITDA margin by 2024. Progress has been made towards these targets
and, while the Group expects Motion Metrics to continue to grow as
it leverages the benefits of being partnered with ESCO and the
opportunities within Minerals, the entry targets are considered
challenging. Due to commercial sensitivity these targets are not
disclosed. At present, the probability of Motion Metrics exceeding
these targets in order to trigger a contingent payment is
considered to remain uncertain, in part due to the relative infancy
of the business. As a result, no contingent consideration has been
recorded at the balance sheet date in both the current and prior
periods. This will be reassessed in future periods as the business
develops.
12. Provisions
Warranties
& contract Exceptional
claims Asbestos-related Employee-related items Other Total
GBPm GBPm GBPm GBPm GBPm GBPm
==================== =========== ================ ================ =========== ===== ======
At 31 December 2022 10.4 55.2 13.5 5.4 13.7 98.2
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
Additions 7.0 0.9 8.2 11.3 1.1 28.5
Utilised (4.1) (4.0) (9.4) (6.0) (0.3) (23.8)
Unutilised (0.1) 0.5 - (0.4) (0.1) (0.1)
Exchange adjustment (0.4) (2.5) (0.7) (0.2) (0.6) (4.4)
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
At 30 June 2023 12.8 50.1 11.6 10.1 13.8 98.4
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
Current 12.8 8.3 7.7 9.9 3.3 42.0
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
Non-current - 41.8 3.9 0.2 10.5 56.4
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
At 30 June 2023 12.8 50.1 11.6 10.1 13.8 98.4
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
Current 8.8 8.2 8.0 1.4 2.2 28.6
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
Non-current - 50.4 5.0 0.1 10.1 65.6
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
At 30 June 2022 8.8 58.6 13.0 1.5 12.3 94.2
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
Current 10.4 8.5 7.9 5.2 3.3 35.3
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
Non-current - 46.7 5.6 0.2 10.4 62.9
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
At 31 December 2022 10.4 55.2 13.5 5.4 13.7 98.2
-------------------- ----------- ---------------- ---------------- ----------- ----- ------
The impact of discounting is only relevant for the
Asbestos-related category of provision, with lower discount rates
at 30 June 2023 resulting in a GBP0.6m increase in the provision
which is included within unutilised above.
Warranties & contract claims
Provision has been made in respect of actual warranty claims on
goods sold and services provided, and allowance has been made for
potential warranty claims based on past experience for goods and
services sold with a warranty guarantee. At 30 June 2023, the
warranties portion of the provision totalled GBP9.2m (2022:
GBP6.8m). At 30 June 2023, all of these costs relate to claims that
fall due within one year of the balance sheet date.
Provision has been made in respect of sales contracts entered
into for the sale of goods in the normal course of business where
the unavoidable costs of meeting the obligations under the
contracts exceed the economic benefits expected to be received from
the contracts and before allowing for future expected aftermarket
revenue streams. Provision is made immediately when it becomes
apparent that expected costs will exceed the expected benefits of
the contract. At 30 June 2023, the contract claims element, which
includes onerous provision, was GBP3.6m (2022: GBP2.0m), all of
which is expected to be incurred within one year of the balance
sheet date.
Asbestos-related claims
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ================================= ======= ============
US asbestos-related provision -
49.9 pre-1981 date of first exposure 45.0 52.6
----------- --------------------------------- ------- ------------
US asbestos-related provision -
2.8 post-1981 date of first exposure 2.6 2.9
----------- --------------------------------- ------- ------------
US asbestos-related provision -
52.7 total 47.6 55.5
----------- --------------------------------- ------- ------------
2.5 UK asbestos-related provision 2.5 3.1
----------- --------------------------------- ------- ------------
55.2 Total asbestos-related provision 50.1 58.6
----------- --------------------------------- ------- ------------
US asbestos-related provision
Certain of the Group's US-based subsidiaries are co-defendants
in lawsuits pending in the US in which plaintiffs are claiming
damages arising from alleged exposure to products previously
manufactured which contained asbestos. The dates of alleged
exposure currently range from the 1950s to the 1980s.
The Group has historically held comprehensive insurance cover
for cases of this nature and continues to do so for claims with a
date of first exposure (dofe) pre-1981. The expiration of one of
the Group's insurance policies in 2019 resulted in no further
insurance cover for claims with a post-1981 dofe. All claims are
directly administered by National Coordinating Counsel on behalf of
the Group's insurers who also meet associated defence costs. The
insurers, their legal advisers and in-house counsel agree and
execute the defence strategy between them.
A review of both the Group's expected liability for US
asbestos-related diseases and the adequacy of the Group's insurance
policies to meet future settlement and defence costs was completed
in conjunction with external advisers in 2020 as part of our
planned triennial actuarial update. This review was based on an
industry standard epidemiological decay model, and Weir's claims
settlement history. The 2020 review reflected higher levels of
claims, particularly relating to the 1970s and 1980s, and a longer
dofe period, but lower settlement values than the previous review
conducted in 2017. Further details of this review, the resulting US
asbestos-related provision and insurance asset and judgements
applied is included in note 22 of our 2022 Annual Report and
Financial Statements.
In the 6 months to 30 June 2023 the US asbestos-related
provision was updated for changes in discount rate, period end FX
rates and adjusted in line with the actuarial model to reflect
expected settlements and the estimate of ten years of future
claims. The insurance asset was updated to reflect settlements in
the period. The table below represents the Directors' best estimate
of the future liability and corresponding insurance asset.
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ================================= ======= ============
US asbestos-related provision
----------- --------------------------------- ------- ------------
68.8 Gross provision 62.2 71.6
----------- --------------------------------- ------- ------------
(16.1) Effect of discounting (14.6) (16.1)
----------- --------------------------------- ------- ------------
Discounted US asbestos-related
52.7 provision 47.6 55.5
----------- --------------------------------- ------- ------------
32.0 Insurance asset 24.6 40.9
----------- --------------------------------- ------- ------------
20.7 Net US asbestos-related liability 23.0 14.6
----------- --------------------------------- ------- ------------
The Gross provision and Effect of discounting at 31 December
2022 have been amended from what was initially published in the
2022 Annual Report and Financial Statements, with both figures
grossed up by GBP10.0m to correctly reflect the impact of
discounting. There is no further impact from this change across the
financial statements.
The insurance asset consists of GBP7.2m (2022: GBP7.4m)
presented within Trade and other receivables as a current asset,
and GBP17.4m (2022: GBP33.5m) as Other receivables within
non-current assets.
There remains inherent uncertainty associated with estimating
future costs in respect of asbestos-related diseases. Actuarial
estimates of future indemnity and defence costs associated with
asbestos-related diseases are subject to significantly greater
uncertainty than actuarial estimates for other types of exposures.
This uncertainty results from factors that are unique to the
asbestos claims litigation and settlement process including but not
limited to:
i) the possibility of future state or federal legislation
applying to claims for asbestos-related diseases;
ii) the ability of the plaintiff's bar to develop and sustain
new legal theory and/or develop new populations of claimants;
iii) changes in focus of the plaintiff's bar;
iv) changes in the Group's defence strategy; and
v) changes in the financial condition of other co-defendants in
suits naming the Group and affiliated businesses.
As a result, there can be no guarantee that the assumptions used
to estimate the provision will result in an accurate prediction of
the actual costs that may be incurred.
Since the last triennial update completed in 2020, we have
experienced a higher number of claims received than modelled across
both, Mesothelioma and Lung Cancer, disease types. Average
settlement values have been marginally higher for Mesothelioma
cases, but lower for Lung Cancer cases. Settlements largely occur
within four years of a claim being received and the settlement
rates for Mesothelioma cases are broadly in line with the model
while Lung Cancer case settlement rates are trending below.
These variations from the model may be influenced by
fluctuations in the profile of case rates across jurisdictions
coupled with the potential impact of the Covid-19 pandemic.
However, if current case numbers and average settlement values were
to continue, this may lead to the insurance asset being eroded as
early as 2025, two years earlier than initially suggested in the
2020 actuarial model.
As noted above, there are a number of uncertain factors involved
in the estimation of the provision and variations in case numbers
and settlements are to be expected from period-to-period.
Sensitivity analysis reflecting reasonably probable scenarios has
been performed and is included in note 22 of our 2022 Annual Report
and Financial Statements. Our actual claims experience will be
reflected in the next triennial valuation due in the second half of
2023, and will be incorporated in our 2023 Annual Report and
Financial Statements.
The Group's US subsidiaries have been effective in managing the
asbestos litigation, in part, because the Group has access to
historical project documents and other business records going back
more than 50 years, allowing it to defend itself by determining if
legacy products were present at the location of the alleged
asbestos exposure and, if so, the timing and extent of their
presence. In addition, the Group has consistently and vigorously
defended claims that are without merit.
UK asbestos-related provision
In the UK, there are outstanding asbestos-related claims that
are not the subject of insurance cover. The extent of the UK
asbestos exposure involves a series of legacy employer's liability
claims that all relate to former UK operations and employment
periods in the 1950s to 1970s. In 1989, the Group's employer's
liability insurer (Chester Street Employers Association Ltd) was
placed into run-off, which effectively generated an uninsured
liability exposure for all future long-tail disease claims with an
exposure period pre-dating 1 January 1972. All claims with a
disease exposure post 1 January 1972 are fully compensated via the
Government-established Financial Services Compensation Scheme. Any
settlement to a former employee whose service period straddles 1972
is calculated on a pro rata basis. The Group provides for these
claims based on management's best estimate of the likely costs
given past experience of the volume and cost of similar claims
brought against the Group.
The UK provision was reviewed and adjusted accordingly for
claims experience in the year, resulting in a provision of GBP2.5m
(2022: GBP3.1m).
Employee-related
Employee-related provisions arise from legal obligations in a
number of territories in which the Group operates, the majority of
which relate to compensation associated with periods of service. A
large proportion of the provision is for long service leave. The
outflow is generally dependent upon the timing of employees' period
of leave with the calculation of the majority of the provision
being based on criteria determined by the various
jurisdictions.
Exceptional items
The exceptional items provision relates to exceptional charges
included within note 5 where the cost is based on a reliable
estimate of the obligation.
The opening balance of GBP5.4m includes GBP4.3m related to
Russia, GBP0.4m in relation to capacity optimisation costs as part
of the Performance Excellence programme and GBP0.7m for final Oil
& Gas Division disposal costs related to tax and prior year
Minerals Division balances for severance and onerous contract
provisions.
Additions of GBP11.3m in the period mainly include GBP8.2m of
costs related to the Group's Performance Excellence programme, held
across the Minerals Division and Corporate. A further GBP2.8m in
the Minerals Division relates to a provision created for newly
emerging Russia contract exposures. The utilisation in the period
of GBP6.0m primarily relates to the cash settlement of costs
associated with the Performance Excellence programme of GBP3.5m and
the Russia operations wind down of GBP1.2m, primarily severance
costs.
The closing balance of GBP10.1m includes GBP4.8m in relation to
the Group's Performance Excellence programme, GBP5.0m related to
the wind down of our Russian operations and GBP0.3m for outstanding
onerous lease contracts, legacy restructuring projects and
withholding tax assessments that are still ongoing.
Other
Other provisions include environmental obligations, penalties,
duties due, legal claims and other exposures across the Group.
These balances typically include estimates based on multiple
sources of information and reports from third-party advisers. The
timing of outflows is difficult to predict as many of them will
ultimately rely on legal resolutions and the expected conclusion is
based on information currently available. Where certain outcomes
are unknown, a range of possible scenarios is calculated, with the
most likely being reflected in the provision.
13. Interest-bearing loans & borrowings
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ================= ======= ============
Current
----------- ----------------- ------- ------------
213.7 Bank overdrafts 233.4 133.1
165.3 Fixed-rate notes - 164.2
----------- ----------------- ------- ------------
27.3 Lease liabilities 25.9 26.3
----------- ----------------- ------- ------------
406.3 259.3 323.6
----------- ----------------- ------- ------------
Non-current
----------- ----------------- ------- ------------
336.5 Bank loans 193.4 359.1
657.8 Fixed-rate notes 923.9 653.0
----------- ----------------- ------- ------------
87.8 Lease liabilities 92.4 92.2
----------- ----------------- ------- ------------
1,082.1 1,209.7 1,104.3
----------- ----------------- ------- ------------
The Group operates a notional cash pooling arrangement in which
individual balances are not offset for reporting purposes. Cash and
short-term deposits at 30 June 2023 includes GBP230.1m (2022:
GBP123.2m) that is part of this arrangement and both cash and
interest-bearing loans and borrowings are grossed up by this
amount.
The Group utilises a number of sources of funding including
Sustainability-Linked Notes, revolving credit facility, term loan,
private placement debt, commercial paper and uncommitted
facilities.
In January 2023, the Group added a further GBP300m term loan
facility to its available financing. The facility was due to mature
in January 2024, subject to a one-year extension option, but the
Group took the decision to cancel the facility in June 2023.
In March 2023, the Group exercised the option to extend its
US$800m multi-currency revolving credit facility by one year which
will now mature in April 2028, with the option to extend for a
further year. Remaining unamortised issue costs of GBP2.1m plus an
additional GBP0.5m will amortise over the remaining term of the
facility.
In June 2023, the Group completed the issue of GBP300m five-year
Sustainability-Linked Notes due to mature in June 2028. The notes
include a Sustainability Performance Target (SPT) to reduce scope
1&2 CO(2) emissions by 19.1% in absolute terms by 2026 from a
2019 baseline, consistent with the Group's SBTi approved target of
30% reduction by the end of 2030. The notes will initially bear
interest at a rate of 6.875% per annum to be paid annually in June.
The interest on the notes will be linked to achievement of the SPT
with an interest rate increase of 0.75% to 7.625% per annum for the
last interest payment due on 14 June 2028 if the Group does not
attain its SPT. These notes are in addition to the US$800m
Sustainability-Linked Notes drawn in May 2021, due to mature in May
2026, which bear interest at a rate of 2.20% per annum.
In June 2023, the Group amended its US$1bn commercial paper
programme to a US$800m commercial paper programme. At 30 June 2023,
a total of GBPnil (2022: GBPnil) was outstanding under the
programme.
At 30 June 2023, a total of GBPnil (2022: GBP164.2m) was
outstanding under private placement.
At 30 June 2023, GBP193.4m (2022: GBP359.1m) was drawn under the
US$800m multi-currency revolving credit facility which is disclosed
net of unamortised issue costs of GBP2.6m (2022: GBP2.6m).
At 30 June 2023, a total of GBP923.9m (2022: GBP653.0m) was
outstanding under Sustainability-Linked Notes which is disclosed
net of unamortised issue costs of GBP5.2m (2022: GBP4.0m).
14. Pensions & other post-employment benefit plans
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ================ ======== ============
50.0 Plans in surplus 38.7 59.2
----------- ---------------- -------- ------------
(34.9) Plans in deficit (29.6) (34.8)
----------- ---------------- -------- ------------
15.1 Net asset 9.1 24.4
----------- ---------------- -------- ------------
The IAS 19 funding position across the Group's legacy UK and
North American schemes reduced from a net surplus of GBP15.1m at 31
December 2022 to a net surplus of GBP9.1m at 30 June 2023. This is
primarily due to a GBP12.0m loss in the UK Main plan following a
pensioner buy-in, which results in 63% (December 2022: 39%) of the
UK Main scheme liabilities now being insured. Other movements
relating to net losses in UK assets and experience losses resulting
from UK inflation were offset by gains driven by higher UK discount
rates and a reduction in deficit across our North American
plans.
15. Derivative financial instruments
The Group enters into derivative financial instruments in the
normal course of business in order to hedge its exposure to foreign
exchange risk. Derivatives are only used for economic hedging
purposes and no speculative positions are taken. Derivatives are
recognised as held for trading and at fair value through profit and
loss unless they are designated in IFRS 9 compliant hedge
relationships.
The table below summarises the types of derivative financial
instrument included within each balance sheet category.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ==================================== ======== ============
Included in non-current assets
----------- ------------------------------------ -------- ------------
Forward foreign currency contracts
- designated as cash flow hedges 0.1 -
- 0.1 -
----------- ------------------------------------ -------- ------------
Included in current assets
----------- ------------------------------------ -------- ------------
Forward foreign currency contracts
1.0 designated as cash flow hedges 0.8 -
Other forward foreign currency
7.9 contracts 5.1 7.4
----------- ------------------------------------ -------- ------------
8.9 5.9 7.4
----------- ------------------------------------ -------- ------------
Included in current liabilities
----------- ------------------------------------ -------- ------------
Forward foreign currency contracts
(1.9) designated as cash flow hedges (0.6) (0.2)
----------- ------------------------------------ -------- ------------
Forward foreign currency contracts
(0.1) designated as net investment hedges - (0.4)
Other forward foreign currency
(11.2) contracts (6.5) (9.8)
----------- ------------------------------------ -------- ------------
(13.2) (7.1) (10.4)
----------- ------------------------------------ -------- ------------
Included in non-current liabilities
Other forward foreign currency
- contracts - (0.4)
----------- ------------------------------------ -------- ------------
- - (0.4)
----------- ------------------------------------ -------- ------------
Net derivative financial liabilities
(4.3) - total Group (1.1) (3.4)
----------- ------------------------------------ -------- ------------
Carrying amounts & fair values
Financial assets and liabilities (with the exception of
derivative financial instruments) are initially recognised at fair
value net of transaction costs. Subsequently they are recognised at
either fair value or amortised cost. Derivative financial
instruments are initially recognised at fair value and subsequently
remeasured at fair value.
The Group uses the following hierarchy for determining and
disclosing the fair value of financial instruments by valuation
technique:
Level Quoted (unadjusted) prices in active markets for identical
1: assets or liabilities;
Level Other techniques for which all inputs that have a significant
2: effect on the recorded fair value are observable, either
directly or indirectly;
Level Techniques which use inputs which have a significant effect
3: on the recorded fair value that are not based on observable
market data.
Set out below is a comparison of carrying amounts and fair
values of all of the Group's financial instruments that are
reported in the financial statements.
Carrying Carrying Fair Carrying
amount Fair value amount value amount Fair value
31 December 31 December 30 June 30 June 30 June 30 June
2022 2022 2023 2023 2022 2022
GBPm GBPm GBPm GBPm GBPm GBPm
----------- ----------- ------------------------------- -------- ------- -------- ----------
Financial assets -
total Group
----------- ----------- ------------------------------- -------- ------- -------- ----------
Derivative financial
instruments recognised
at fair value through
7.9 7.9 profit or loss 5.1 5.1 7.4 7.4
----------- ----------- ------------------------------- -------- ------- -------- ----------
Derivative financial
instruments in designated
1.0 1.0 hedge accounting relationships 0.9 0.9 - -
Trade & other receivables
excluding statutory
assets, prepayments
& construction contract
540.9 540.9 assets 519.0 519.0 571.7 571.7
----------- ----------- ------------------------------- -------- ------- -------- ----------
691.2 691.2 Cash & short-term deposits 626.9 626.9 467.0 467.0
1,241.0 1,241.0 1,151.9 1,151.9 1,046.1 1,046.1
----------- ----------- ------------------------------- -------- ------- -------- ----------
Financial liabilities
- total Group
----------- ----------- ------------------------------- -------- ------- -------- ----------
Derivative financial
instruments recognised
at fair value through
11.2 11.2 profit or loss 6.5 6.5 10.2 10.2
----------- ----------- ------------------------------- -------- ------- -------- ----------
Derivative financial
instruments in designated
2.0 2.0 hedge accounting relationships 0.6 0.6 0.6 0.6
----------- ----------- ------------------------------- -------- ------- -------- ----------
Deferred consideration
2.0 2.0 payable 1.0 1.0 2.5 2.5
----------- ----------- ------------------------------- -------- ------- -------- ----------
Amortised cost:
----------- ----------- ------------------------------- -------- ------- -------- ----------
823.1 784.3 Fixed-rate borrowings 923.9 859.6 817.2 796.7
----------- ----------- ------------------------------- -------- ------- -------- ----------
336.5 336.5 Floating-rate borrowings 193.4 193.4 359.1 359.1
----------- ----------- ------------------------------- -------- ------- -------- ----------
115.1 115.1 Leases 118.3 118.3 118.5 118.5
----------- ----------- ------------------------------- -------- ------- -------- ----------
213.7 213.7 Bank overdrafts 233.4 233.4 133.1 133.1
----------- ----------- ------------------------------- -------- ------- -------- ----------
Trade & other payables
excluding statutory
liabilities & contract
495.7 495.7 liabilities 438.7 438.7 441.2 441.2
1,999.3 1,960.5 1,915.8 1,851.5 1,882.4 1,861.9
----------- ----------- ------------------------------- -------- ------- -------- ----------
The Group operates a notional cash pooling arrangement in which
individual balances are not offset for reporting purposes. Cash and
short-term deposits at 30 June 2023 includes GBP230.1m (2022:
GBP123.2m) that is part of this arrangement and both cash and
interest-bearing loans and borrowings are grossed up by this
amount.
Assets and liabilities recognised at amortised cost:
Following the settlement of private placement debt and the issue
of further Sustainability-Linked Notes, the fair value of
fixed-rate borrowings has been reassessed as a level 1 fair value
measurement rather than level 2 as the full balance is now
calculated using quoted market prices. All other financial assets
and liabilities carried at cost require level 2 fair value
measurement for disclosure purposes. The fair value of floating
rate borrowings approximates the carrying value due to the variable
nature of the interest terms. The fair value of lease liabilities
is disclosed in line with the carrying value which is estimated by
discounting future cash flows using the rate implicit in the lease
or the Group's incremental borrowing rate. The fair value of cash
and short-term deposits, trade and other receivables and trade and
other payables approximates their carrying amount due to the
short-term maturities of these instruments.
Assets and liabilities recognised at fair value:
The Group enters into derivative financial instruments with
various counterparties, principally financial institutions with
investment grade credit ratings. The derivative financial
instruments are valued using valuation techniques with market
observable inputs including spot and forward foreign exchange
rates, interest rate curves, counterparty and own credit risk. The
fair value of cross currency swaps is calculated as the present
value of the estimated future cash flows based on spot foreign
exchange rates. The fair value of forward foreign currency
contracts is calculated as the present value of the estimated
future cash flows based on spot and forward foreign exchange
rates.
For financial instruments that are recognised at fair value on a
recurring basis, the Group determines whether transfers have
occurred between levels in the hierarchy by re-assessing
categorisation (based on the lowest level input that is significant
to the fair value measurement as a whole) at the end of each
reporting period. The Group holds all financial instruments
recognised at fair value at level 2 with the exception of
contingent consideration which is a level 3 fair value measurement.
The current fair value of contingent consideration is nil and
further detail regarding the basis of valuation is included in note
11 . During the 6 months ended 30 June 2023 and the year ended 31
December 2022, there were no transfers between level 1 and level 2
fair value measurements and no transfers into or out of level 3
fair value measurements.
16. Additional cash flow information
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm Notes GBPm GBPm
=========== ===================================== ===== ======== ============
Total operations
----------- ------------------------------------- ----- -------- ------------
Net cash generated from operations
307.5 Operating profit 194.0 151.0
----------- ------------------------------------- ----- -------- ------------
Exceptional and other adjusting
51.4 items 5 4.6 (0.5)
41.6 Amortisation of intangible assets 19.2 20.0
----------- ------------------------------------- ----- -------- ------------
(2.5) Share of results of joint ventures (1.3) (1.0)
----------- ------------------------------------- ----- -------- ------------
Depreciation of property, plant
47.0 & equipment 20.4 22.7
----------- ------------------------------------- ----- -------- ------------
Depreciation of right-of-use
31.4 assets 15.8 14.8
----------- ------------------------------------- ----- -------- ------------
Impairment of property, plant
0.2 & equipment 0.9 -
----------- ------------------------------------- ----- -------- ------------
(0.2) Grants received - -
----------- ------------------------------------- ----- -------- ------------
Gains on disposal of property,
(0.6) plant & equipment (0.5) (0.5)
Funding of pension & post-retirement
(2.9) costs (0.5) (1.7)
----------- ------------------------------------- ----- -------- ------------
8.0 Employee share schemes 4.2 4.1
----------- ------------------------------------- ----- -------- ------------
14.3 Transactional foreign exchange 1.3 4.9
----------- ------------------------------------- ----- -------- ------------
1.2 Increase (decrease) in provisions 2.4 (1.3)
----------- ------------------------------------- ----- -------- ------------
Cash generated from operations
before working capital cash
496.4 flows 260.5 212.5
----------- ------------------------------------- ----- -------- ------------
(128.6) Increase in inventories (33.9) (104.4)
----------- ------------------------------------- ----- -------- ------------
Decrease in trade & other receivables
49.8 & construction contracts 8.0 17.0
----------- ------------------------------------- ----- -------- ------------
(Decrease) increase in trade
& other payables & construction
30.2 contracts (61.7) (24.9)
----------- ------------------------------------- ----- -------- ------------
447.8 Cash generated from operations 172.9 100.2
----------- ------------------------------------- ----- -------- ------------
Additional pension contributions
(9.7) paid (7.7) (7.7)
----------- ------------------------------------- ----- -------- ------------
Exceptional and other adjusting
(14.2) cash items (5.2) (7.2)
----------- ------------------------------------- ----- -------- ------------
Exceptional cash items - acquired
(9.7) vendor liabilities - (8.9)
----------- ------------------------------------- ----- -------- ------------
(93.4) Income tax paid (51.1) (40.2)
----------- ------------------------------------- ----- -------- ------------
Net cash generated from operating
320.8 activities 108.9 36.2
----------- ------------------------------------- ----- -------- ------------
The following tables summarise the cash flows arising on
acquisitions (note 11) and disposals (note 7 ).
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ====================================== ======== ============
Acquisitions of subsidiaries
Acquisition of subsidiaries - cash
16.3 paid - 16.2
=========== ====================================== ======== ============
Acquisition of subsidiaries - deferred
0.5 consideration paid 1.0 -
=========== ====================================== ======== ============
(1.6) Cash & cash equivalents acquired - (1.6)
Total cash outflow relating to
15.2 acquisitions 1.0 14.6
----------- -------------------------------------- -------- ------------
Net cash outflow arising on disposals
Consideration received net of costs
paid & cash disposed of - ESCO
(2.0) Russia - -
=========== ====================================== ======== ============
Prior period disposals - settlement
of final costs and final completion
(0.1) adjustment (0.4) -
Total cash outflow relating to
(2.1) disposals (0.4) -
----------- -------------------------------------- -------- ------------
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ======================================= ======== ============
Cash & cash equivalents comprise
the following
----------- --------------------------------------- -------- ------------
691.2 Cash & short-term deposits 626.9 467.0
----------- --------------------------------------- -------- ------------
(213.7) Bank overdrafts & short-term borrowings (233.4) (133.1)
477.5 393.5 333.9
----------- --------------------------------------- -------- ------------
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ================================== ========= ============
Net debt comprises the following
----------- ---------------------------------- --------- ------------
691.2 Cash & short-term deposits 626.9 467.0
----------- ---------------------------------- --------- ------------
Current interest-bearing loans
(406.3) & borrowings (note 13) (259.3) (323.6)
----------- ---------------------------------- --------- ------------
Non-current interest-bearing loans
(1,082.1) & borrowings (note 13) (1,209.7) (1,104.3)
(797.2) (842.1) (960.9)
----------- ---------------------------------- --------- ------------
Reconciliation of financing cash flows to movement in net
debt
Opening
balance Closing
at 31 balance
December Cash Non-cash at 30
2022 movements Additions/acquisitions Disposals FX movements June 2023
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
======================== ========= ========== ====================== ========= ====== ========== ==========
Cash & cash equivalents 477.5 (51.9) - - (32.1) - 393.5
------------------------ --------- ---------- ---------------------- --------- ------ ---------- ----------
Third-party loans (1,165.5) 15.0 - - 25.4 - (1,125.1)
------------------------ --------- ---------- ---------------------- --------- ------ ---------- ----------
Leases (115.1) 15.7 (24.1) - 5.3 (0.1) (118.3)
------------------------ --------- ---------- ---------------------- --------- ------ ---------- ----------
Unamortised issue
costs 5.9 4.0 - - - (2.1) 7.8
------------------------ --------- ---------- ---------------------- --------- ------ ---------- ----------
Amounts included
in gross debt (1,274.7) 34.7 (24.1) - 30.7 (2.2) (1,235.6)
------------------------ --------- ---------- ---------------------- --------- ------ ---------- ----------
Amounts included
in net debt (797.2) (17.2) (24.1) - (1.4) (2.2) (842.1)
------------------------ --------- ---------- ---------------------- --------- ------ ---------- ----------
Financing derivatives (0.1) 0.2 - - - (0.1) -
Total financing
liabilities(1) (1,274.8) 34.9 (24.1) - 30.7 (2.3) (1,235.6)
------------------------ --------- ---------- ---------------------- --------- ------ ---------- ----------
Closing
Opening balance
balance at 31
at 30 Non-cash December
June 2022 Cash movements Additions/acquisitions Disposals FX movements 2022
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
======================== ========== ============== ====================== ========= ===== ========== =========
Cash & cash equivalents 333.9 147.8 - (1.9) (2.3) - 477.5
------------------------ ---------- -------------- ---------------------- --------- ----- ---------- ---------
Third-party loans (1,182.9) 25.4 (0.4) - (7.6) - (1,165.5)
------------------------ ---------- -------------- ---------------------- --------- ----- ---------- ---------
Leases (118.5) 16.5 (14.9) - 1.0 0.8 (115.1)
------------------------ ---------- -------------- ---------------------- --------- ----- ---------- ---------
Unamortised issue
costs 6.6 - - - - (0.7) 5.9
------------------------ ---------- -------------- ---------------------- --------- ----- ---------- ---------
Amounts included
in gross debt (1,294.8) 41.9 (15.3) - (6.6) 0.1 (1,274.7)
------------------------ ---------- -------------- ---------------------- --------- ----- ---------- ---------
Amounts included
in net debt (960.9) 189.7 (15.3) (1.9) (8.9) 0.1 (797.2)
------------------------ ---------- -------------- ---------------------- --------- ----- ---------- ---------
Financing derivatives (0.2) 0.5 - - - (0.4) (0.1)
Total financing
liabilities(1) (1,295.0) 42.4 (15.3) - (6.6) (0.3) (1,274.8)
------------------------ ---------- -------------- ---------------------- --------- ----- ---------- ---------
(1. Total financing liabilities comprise gross debt plus other
liabilities relating to financing activities.)
17. Related party disclosure
The following table provides the total amount of significant
transactions which have been entered into by the Group with related
parties for the relevant financial period and outstanding balances
at the period end.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 2023 30 June 2022
GBPm GBPm GBPm
=========== ==================================== ======== ============
Sales of goods to related parties
1.1 - joint ventures 0.4 0.7
----------- ------------------------------------ -------- ------------
Sales of services to related parties
0.1 - joint ventures 0.1 0.1
----------- ------------------------------------ -------- ------------
Purchases of goods from related
25.9 parties - joint ventures 10.5 11.8
----------- ------------------------------------ -------- ------------
Amounts owed to related parties
6.2 - joint ventures 5.0 -
----------- ------------------------------------ -------- ------------
Amounts owed to related parties
8.2 - group pension plans 1.4 1.7
----------- ------------------------------------ -------- ------------
Amounts owed by related parties
0.3 - joint ventures 0.1 -
----------- ------------------------------------ -------- ------------
18. Legal claims
The Company and certain subsidiaries are, from time-to-time,
party to legal proceedings and claims that arise in the normal
course of business. Provisions have been made where the Directors
have assessed that a cash outflow is probable. All other claims are
believed to be remote or are not yet ripe.
19. Exchange rates
The principal exchange rates applied in the preparation of these
financial statements were as follows.
6 months 6 months
Year ended ended ended
31 December 30 June
2022 Average rate (per GBP) 2023 30 June 2022
=========== ====================== ======== ============
1.24 US Dollar 1.23 1.30
----------- ---------------------- -------- ------------
1.78 Australian Dollar 1.82 1.81
----------- ---------------------- -------- ------------
1.17 Euro 1.14 1.19
----------- ---------------------- -------- ------------
1.61 Canadian Dollar 1.66 1.65
----------- ---------------------- -------- ------------
1,078.02 Chilean Peso 993.99 1,073.60
----------- ---------------------- -------- ------------
20.19 South African Rand 22.44 20.03
----------- ---------------------- -------- ------------
6.39 Brazilian Real 6.26 6.61
8.30 Chinese Yuan 8.54 8.42
----------- ---------------------- -------- ------------
97.06 Indian Rupee 101.35 98.98
----------- ---------------------- -------- ------------
Closing rate (per GBP)
======== ====================== ======== ========
1.21 US Dollar 1.27 1.22
-------- ---------------------- -------- --------
1.77 Australian Dollar 1.91 1.76
-------- ---------------------- -------- --------
1.13 Euro 1.16 1.16
-------- ---------------------- -------- --------
1.64 Canadian Dollar 1.68 1.57
-------- ---------------------- -------- --------
1,026.77 Chilean Peso 1,020.41 1,126.97
-------- ---------------------- -------- --------
20.61 South African Rand 23.91 19.81
-------- ---------------------- -------- --------
6.39 Brazilian Real 6.09 6.32
8.34 Chinese Yuan 9.22 8.16
-------- ---------------------- -------- --------
100.05 Indian Rupee 104.25 96.17
-------- ---------------------- -------- --------
Directors' Statement of Responsibilities
The Directors confirm that these condensed interim financial
statements have been prepared in accordance with UK-adopted
International Accounting Standard 34 'Interim Financial Reporting',
and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority and that the
interim management report includes a fair review of the information
required by DTR 4.2.7 and DTR 4.2.8, namely:
a. an indication of important events that have occurred during
the first six months and their impact on the condensed set of
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial year;
and
b. material related-party transactions in the first six months
and any material changes in the related party transactions
described in the last annual report.
A list of current directors is maintained on The Weir Group PLC
website which can be found at www.global.weir .
On behalf of the Board
John Heasley
Chief Financial Officer
1 August 2023
Independent review report to The Weir Group PLC
Report on the condensed consolidated interim financial
statements
Our conclusion
We have reviewed The Weir Group PLC's condensed consolidated
interim financial statements (the "interim financial statements")
in the Interim Report of The Weir Group PLC for the 6 month period
ended 30 June 2023 (the "period").
Based on our review, nothing has come to our attention that
causes us to believe that the interim financial statements are not
prepared, in all material respects, in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting'
and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority.
The interim financial statements comprise:
-- the Consolidated Balance Sheet as at 30 June 2023;
-- the Consolidated Income Statement and Consolidated Statement
of Comprehensive Income for the period then ended;
-- the Consolidated Cash Flow Statement for the period then ended;
-- the Consolidated Statement of Changes in Equity for the period then ended; and
-- the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim Report
of The Weir Group PLC have been prepared in accordance with UK
adopted International Accounting Standard 34, 'Interim Financial
Reporting' and the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority.
Basis for conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410, 'Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity' issued by the Financial Reporting Council for use in the
United Kingdom ("ISRE (UK) 2410"). A review of interim financial
information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK) and,
consequently, does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the Interim
Report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in
the interim financial statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
conclusion section of this report, nothing has come to our
attention to suggest that the directors have inappropriately
adopted the going concern basis of accounting or that the directors
have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on
the review procedures performed in accordance with ISRE (UK) 2410.
However, future events or conditions may cause the group to cease
to continue as a going concern.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the directors
The Interim Report, including the interim financial statements,
is the responsibility of, and has been approved by the directors.
The directors are responsible for preparing the Interim Report in
accordance with the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority. In
preparing the Interim Report, including the interim financial
statements, the directors are responsible for assessing the group's
ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the
group or to cease operations, or have no realistic alternative but
to do so.
Our responsibility is to express a conclusion on the interim
financial statements in the Interim Report based on our review. Our
conclusion, including our Conclusions relating to going concern, is
based on procedures that are less extensive than audit procedures,
as described in the Basis for conclusion paragraph of this report.
This report, including the conclusion, has been prepared for and
only for the company for the purpose of complying with the
Disclosure Guidance and Transparency Rules sourcebook of the United
Kingdom's Financial Conduct Authority and for no other purpose. We
do not, in giving this conclusion, accept or assume responsibility
for any other purpose or to any other person to whom this report is
shown or into whose hands it may come save where expressly agreed
by our prior consent in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
Glasgow
1 August 2023
Shareholder Information
The Board has approved an interim dividend of 17.8p for 2023
(2022: 13.5p).
Financial Calendar
Ex-dividend date for interim dividend
5 October 2022
Record date for interim dividend
6 October 2023
Shareholders on the register at this date will receive the
dividend
Interim dividend paid
3 November 2023
Our Interim Report will be available shortly to download from
The Weir Group PLC website at www.global.weir
Disclaimer
This information includes 'forward-looking statements'. All
statements other than statements of historical fact included in
this presentation, including, without limitation, those regarding
The Weir Group PLC's (the "Group") financial position, business
strategy, plans (including development plans and objectives
relating to the Group's products and services) and objectives of
management for future operations, are forward-looking statements.
These statements contain the words "anticipate", "believe",
"intend", "estimate", "expect" and words of similar meaning. Such
forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the
actual results, performance or achievements of the Group to be
materially different from future results, performance or
achievements expressed or implied by such forward-looking
statements. Such forward-looking statements are based on numerous
assumptions regarding the Group's present and future business
strategies and the environment in which the Group will operate in
the future. These forward-looking statements speak only as at the
date of this document. The Group expressly disclaims any obligation
or undertaking to disseminate any updates or revisions to any
forward-looking statements contained herein to reflect any change
in the Group's expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement is
based. Past business and financial performance cannot be relied on
as an indication of future performance.
Registered office and company number
1 West Regent Street
Glasgow
G2 1RW
Scotland
Registered in Scotland
Company number: SC002934
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END
IR RBMLTMTBJBJJ
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August 01, 2023 02:00 ET (06:00 GMT)
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