Renold PLC on Monday predicted full-year profit will be ‘materially ahead of current market expectations’, as it hailed a robust order book.

Shares in Renold rose 2.5% to 41.32 pence each in London on Monday morning.

The Manchester, UK-based supplier of industrial chains and related power transmission products said its order book at March 31 totalled £83.6 million.

This remained close to ‘record levels’ and in line with the half year position, also of £83.6 million. Order intake in the second half increased over the first six months by 7.5%, Renold said.

In a trading update, Renold said annual revenue of £241.5 million marked a 2.3% fall from the £247.1 million reported for the previous year, adjusting for the impact of foreign currency.

Adjusted operating profit is expected to be around 20% higher than financial 2023, which was reported at £24.2 million. This implies a figure of around £29.0 million.

This was driven by a further improvement in margin, Renold said.

The revenue figure lies below a company-compiled consensus of £244.3 million, whilst the underlying operating profit forecast exceeds a consensus of £26.5 million.

Renold noted ‘strong cash conversion, and careful management of working capital’ has resulted in year-end net debt falling to £24.9 million from £29.8 million the year prior.

‘The group continues to strengthen its financial position, which provides funding capacity to support its strategic growth objectives. These include both investment to further enhance operational capabilities as well as value-accretive acquisitions, from a developing pipeline of opportunities,’ Renold said.

Renold will announce its full year results on July 17.

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