Victrex holds guidance but warns of subdued medical revenues

(Sharecast News) - Polymers maker Victrex held guidance after a solid first-quarter performance saw revenues rise 9% but warned trading conditions remain mixed, with medical sales still subdued, driven by ongoing destocking among its customers. The company, which makes parts for anything from smartphones, aircraft and cars to energy production and medical devices, said guidance remained for at least mid-single digit volume growth for fiscal 2025, with underlying pre-tax profit growth ahead of volume growth.

Foreign exchange headwinds and costs related to a new China facility would be a drag on first half growth, it added. First quarter revenue came in at £66.6m, with group volume up 20% at 898 tonnes.

"Cost control, self-help measures, higher asset utilisation and lower raw material costs will help to underpin profit improvement in full-year 2025. However, we are mindful that current trading conditions remain mixed, with continuing softness in medical," the company said in a trading update on Friday.

This meant profit growth would be weighted to the second half of the financial year, reflecting the weaker performance in the medical unit and sales mix, the impact of currency - which is a £7m-£8m headwind to annual profits - being heavily weighted to the first half and annualised costs from its new China facility.

"All of these factors are expected to limit our progress in the first half year, versus the first half of 2024," Victrex said.

Reporting by Frank Prenesti for Sharecast.com