In a trading statement the Hessle-based firm said its heavyweight conveyor belting business delivered a strong performance in Asia Pacific where the service operations are at capacity.

In Europe, it has developed new markets which resulted in improved margin performance.

But despite its US business reporting good revenue growth, rapidly rising material costs have put pressure on Fenner to pass increases to its clients.

The company said: "Whilst these are being passed on to our customers there is an inevitable lag constraining margin growth in the very short term. Whilst medium and longer term prospects remain unchanged the short term opportunities to outperform are more restricted."

The group said its acquisitions in the current financial year in the technical weaving, digital printing, bushing, and conveyor service sectors have performed ahead of expectations.

It added: "In Advanced Engineered Products our exposure to niche markets has enabled us to maintain our expected level of volume and profitability.

"This is against a backdrop of underlying markets some of which have been somewhat weaker. In accordance with our plans, the new acquisitions have helped propel us into growth markets."

Fenner said "excellent" progress had been achieved in its major capital investment projects, with commissioning of the US wide belt expansion anticipated to be on schedule in the coming months.

In June it announced the acquisition of US and Chilean-based CSC Group - seen as a major strategic advance to its value added mining customer support programme.

Last week the firm announced it had sold its North Carolina operation for $7.8m (£3.9m) to Forbo Siegling LLC, a subsidiary of Switzerland-based Forbo Holding.

The sale further supports Fenner's strategy of concentrating on its heavyweight conveyor belting business primarily for mining applications in particular coal mining.

The company said: "Our balance sheet remains strong with net borrowings, as anticipated, comfortably within the scope of existing banking facilities.

"We are mindful of the uncertain economic conditions in some of our industrial markets.

"However, the energy and commodity markets we serve remain positive, and this, together with our value added strategy, has enabled us to maintain margins, despite rising raw material costs. This, underpinned by the resilience of our order books, gives us confidence in our expectations for the current financial year."