Weir Group Share Price Fell 2.9% on Q3 Results, Then Recovered

The Weir Group PLC (LON: WEIR) share price fell 2.88% after releasing its Q3 financial results, whereas in the Minerals segment, Q3 orders saw a 1% increase. The growth is driven by volume expansion in the mining sector and favourable price realisation, although it was somewhat offset by oil sands-related factors.

Meanwhile, the Q3 orders for ESCO experienced a 3% decrease, primarily as anticipated, with growth in mining partially offset by trends in infrastructure. Weir’s mining equipment has shown promising momentum in terms of demand, reflecting a positive trend.

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Q3 orders for Minerals in Original Equipment (OE) remained stable sequentially, with many small brownfield projects and sustainability initiatives contributing to the stability. The expansion of Weir’s installed base continues, which provides essential support for future Aftermarket (AM) growth.

The company has successfully realised the benefits of its mining-focused portfolio. Strong execution was observed, with Q3 revenues and operating margins improving year-on-year.

The Iron Bridge project, involving Weir’s integrated solution, is performing well, and a service contract is set to commence in Q4. The Performance Excellence initiative remains on track to deliver cost savings of £6 million in 2023.

In terms of the 2023 outlook, the company reiterated its guidance. Weir’s expectations include strong growth in constant currency revenue and operating profit. The company remains on course to achieve its operating margin target of 17%.

Free operating cash conversion is projected to be in the range of 80% to 90%. The company appointed Brian Puffer as its new Chief Financial Officer (CFO). 

Jon Stanton, Weir Group’s CEO, commented: “Our third quarter performance is in line with our expectations. We capitalised on high levels of activity in our mining markets, growing mining aftermarket orders, maintaining good momentum in original equipment and expanding our installed base to support future aftermarket growth. We also executed strongly, growing revenue, expanding our operating margins and realising the initial cost savings from our Performance Excellence transformation programme. Going into the fourth quarter, we have a strong order book and operating momentum. These, coupled with high levels of activity in our mining markets, give us significant confidence in reiterating our 2023 guidance of strong growth…”

Weir Group share price. 

The Weir Group share price fell 2.88% to trade at 1653.5p from Tuesday’s closing price of 1702.5p.