(Reuters) -Shares of Spirax rose more than 15% on Tuesday after the British manufacturing group forecast organic sales growth accelerating in the second half of the year, thanks to a strong order book
Spirax Shares Surge on Optimistic Sales Growth Forecast for H2
Spirax's Sales Growth Forecast
(Reuters) -Shares of Spirax rose more than 15% on Tuesday after the British manufacturing group forecast organic sales growth accelerating in the second half of the year, thanks to a strong order book, following a better-than-expected first-half rise.
The group provides thermal energy and fluid technology solutions to several industries, from healthcare and pharmaceuticals to transport and power generation. It expects orders to remain strong across most of its businesses.
The Cheltenham, UK-based company also maintained its full-year outlook, as the company expects progress on its organic margins to be better in the second half of the year amid efforts to cut costs and bolster operations.
Company Overview
"We have delivered first-half results in line with expectations despite the challenging macroeconomic environment, demonstrating the strength of the Group's direct sales Business Model," CEO Nimesh Patel said in a statement.
Market Challenges
In May, the company warned that order delays and lower demand in China and South Korea had been weighing on the business, and outlined steps to counter any impact of tariffs.
Stock Market Reaction
Spirax's shares were the biggest gainer on Britain's blue-chip FTSE-100 index on Tuesday, rising as much as 18.8% to 7,200 pence by 0823 GMT.
Analyst Insights
The company reported a 3% organic growth in revenue to 822.2 million pounds ($1.11 billion) for the six months ended June 30, above analysts' average estimate of a 2.5% growth, according to a company-compiled consensus.
"Following a difficult period marked by significant headwinds across multiple end markets ... today's strong results are a step ... in the right direction," Panmure Liberum analysts said in a note.
($1 = 0.7438 pounds)
(Reporting by Unnamalai L and Pushkala Aripaka in Bengaluru; Editing by Janane Venkatraman)
