Morgan Advanced Materials PLC - Windsor, England-based manufacturer of carbon and ceramic materials - Launches share buyback programme worth up to £40 million in total. The first tranche of £10 million will be run by Investec Bank PLC. It will start on Tuesday and be completed by the end of March. ‘Our strong prospects and balance sheet have enabled us to increase returns to shareholders by supplementing our regular dividend with the launch of this share buyback programme,’ says Chief Executive Officer Pete Raby. ‘Alongside our investments to enhance both organic growth and cost rationalisation, the share buyback is further evidence of the attractive capital allocation options at the group’s disposal.’

The announcement comes as Morgan warns of weakening market conditions in the second half of 2024 and a ‘further deterioration in our outlook for the fourth quarter’. It says sales are up 3.8% in the first nine months of the year on an organic constant-currency basis. Within this Performance Carbon sales are up 13% and Technical Ceramics sales up 3.4%, but Thermal Products sales are down 2.3%. For all of 2024, Morgan expects organic constant-currency revenue growth of about 3%. Combined with additional currency headwinds, the company now expects an adjusted operating profit margin of about 11.4% in 2024. This would be improved on 10.8% in 2023, though still down from 13.6% in 2022.

In response to the outlook, Morgan said it is stepping up its ‘simplification programme’. It now expects to achieve £22 million in annualised savings by 2025 in total at an exceptional cost of £45 million, up from £10 million at a cost of £20 million previously planned.

Current stock price: 245.00 pence, up 0.6% in London on Tuesday

12-month change: up 5.4%

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