Shares in engineering solution company Renold (LON:RNO) dropped 10 percent on Thursday, after the group confirmed that adjusted operating profit for the full year would be towards the lower end of expectations.
The company, who are a leading international supplier of industrial chains and related power transmission products, issued a trading update for the six months to 30th September 2017. Whilst it Torque Transmission division performed in-line with expectations, profitability in its Chain division was affected by machine break-downs at their Einbeck facility and sustained increases in raw material costs.
Renold’s Board confirmed that, due to this unexpected slowdown, it expects adjusted operating profit for the year to 31 March 2018 to be “slightly below the lower end of the current range of analyst forecasts.”
It added that it expects performance in the chain division to improve in the second half, with the machine issues resolved and price increases feeding into revenue.
Group revenue in the period grew by 8.0 percent and, and by 2.7 percent on an underlying basis. Order intake in the period grew by 9.9 percent on an underlying basis.
Shares in Renold are currently trading down 10.45 percent at 46.12 (1039GMT).