Renold (RNO) lost around a tenth of its market value after the small-cap engineer warned that adjusted operating profit would come in “slightly below the lower end of the current range of analyst forecasts” for its March year-end.
Trading in the six months through to the end of September was “mixed”, according to management. Group revenue was up 2.7 per cent at constant currencies, with strengthening underlying sales from both the Torque Transmission and Chain divisions, although the contribution of the latter business was restricted to the first quarter after major machine breakdowns at a production facility in Germany. Renold was forced to incur “increased shipping and maintenance costs to mitigate the impact on key customers”. On the plus side of the ledger, underlying order intake at the division improved to 9 per cent in the second quarter, leaving overall growth for the period at 5.3 per cent.
