Fenner seeing signs of improving demand as US activity picks up

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Engineer Fenner said demand is showing signs of improving, as it reported six months of in-line performance.

The Hessle, East Yorkshire-based company has been buffeted by falling coal prices and fluctuating global demand over the past year.

It said North American demand for its conveyor belts during the six months to the end of February was “below historic levels”. However, it has seen “early but encouraging” signs of improved activity there in recent weeks.

Its conveyor belt business in Australia saw strong trading during the first quarter but lower demand and price pressure from the mining industry in its second quarter. 

“As the group enters the second half of its financial year, we are well positioned to respond to generally improving demand drivers and now look forward to continuing to make progress through our traditionally stronger trading period,” said Fenner.

Its advanced engineered products division, which makes products ranging from high-pressure seals to silicone catheters, performed well in “challenging traditional markets”, but made progress in new sectors and emerging markets.

The division has been hit by customers working through old stockpiles, but is now seeing higher order levels as customers re-stock. Four small companies bought during the half are also “performing well”, it said.

FinnCap analyst David Buxton said mineral markets “remain an area of concern, particularly in Australia”. “We are cautious about comments on customer restocking ahead of recovery.”