Weir Group revenues stable after pivot away from oil and gas
Engineers Weir Group today said that its revenues had fallen just one per cent in 2020, a year in which the firm made the switch away from oil and gas.
The company said that revenue was £1.96bn in 2020, marginally lower than the £2.05bn posted the year before.
It said that its adjusted operating profit fell from £315m to £305m, a three per cent drop.
Chief executive Jon Stanton said: “We’ve had a good start to 2021 and we expect to deliver growth in full year constant currency profits subject to any further disruption from the ongoing Covid-19 pandemic.
“More broadly, underlying conditions are favourable and with the strong platform we’ve created we’re confident of outperforming our markets over the next three years and delivering sustainable long-term profitable growth.”
Back in October the Glasgow-based firm elected to sell its oil and gas division to construction firm Caterpillar for £314m.
Weir had been mulling the move for some months, but was given an extra push by the devastation wreaked on the sector by the pandemic.
It is now purely focused on its mining branch, which used to bring in around three times the revenue its oil business did.
Since deciding to sell the division shares in the firm have soared higher, meaning Weir could well be readmitted to the FTSE 100 index tomorrow.
Hargreaves Lansdown analyst Susannah Streeter said: “So far the strategic move away from oil and gas and the concentration of its efforts on providing mining equipment appears to be paying off.
“Commodity prices forecast to rise further in 2021 as demand grows for minerals and metals to power the green revolution.”