Chain firm’s profits hit by rising costs
MANCHESTER-BASED industrial chain supplier Renold has warned of lower profits after battling increased raw material prices.
In a trading statement covering the five month period from October to February the group said year-on-year revenues are expected to grow by five per cent by the end of March, but operating profit will be below previous expectations.
Robert Purcell, chief executive, said: “The increase in raw material prices has been significant, both in scale and speed, and has challenged our ability to pass these costs through to customers at the same pace. The adverse impact on profit of timing differences between increasing costs and the off-setting sales price increases being realised has continued through the second half of the year.
“This is masking the positive effects of our strategic actions which are delivering organic growth across most chain and torque transmission business units. These actions have also improved the resilience of the group when faced with challenging conditions, as demonstrated by a third year of consistent profit delivery. We continue to remain focused on executing the group’s strategy in order to deliver sustainable improvements in performance.”