Essentra Q3 revenues improve as end-market conditions show signs of recovery

(Sharecast News) - Essential components business Essentra said on Thursday third-quarter revenues had risen 5.9% on a like-for-like, constant currency basis, with order intake up 5.6% year-on-year as end-market conditions showed signs of recovery.

Essentra said September trading returned to second-quarter levels following seasonal softness in July and August, and was delivered even as it continued to "navigate mixed market conditions".

The FTSE 250-listed firm stated its performance across regions remained mixed, with Europe, the Middle East and Africa seeing year-on-year growth, led by strength in Turkey, while demand was subdued in the UK and Western Europe. The Americas maintained momentum, supported by pricing actions and distributor stability, while APAC benefited from business wins in China.

Given the strength of its operations in Turkey, which generate lower margins compared to the rest of EMEA, Essentra also stated that overall gross margins were "slightly weaker than expected" in the period and now anticipates that FY adjusted operating margins will remain consistent with H1.

Looking ahead, Essentra said actions to streamline costs and optimise operations would protect profitability and position it to benefit from operational gearing as markets improve. It also said the board remains confident in delivering medium-term targets, backed by a strong pipeline of growth opportunities.

Reporting by Iain Gilbert at Sharecast.com