Q1 2011/12 Interim Management Statement

Q1 2011/12 performance and outlook

Overall the Group made a solid start to the financial year with revenue and operating profit before exceptional items in line with our expectations and, based upon this performance, we continue to expect that on a constant currency basis we will achieve a year of further progress. 

 

Invensys Operations Management

As anticipated, Invensys Operations Management’s strong performance in the prior year continued into the first quarter.  Excluding a China nuclear order booked in the first quarter last year, order intake was ahead in each major region and across each of our three business sectors, namely control and safety, advanced applications and equipment.  Revenue growth was driven in particular by the further ramp-up of work on recently won large greenfield contracts.  As expected this change in sales mix has tempered improvements in operating margins.

 

Invensys Rail

Invensys Rail produced a satisfactory performance in the first quarter of the year with the conversion of its large order book in new markets more than offsetting a slow down in revenue from its traditional markets.  Order intake was comparable to the first quarter of last year and it has also recently been awarded a large framework agreement by Network Rail for the Thameslink project in London.  The order pipeline remains strong with several large contracts due to be decided during the remainder of the financial year.

 

Invensys Controls

Invensys Controls experienced lower than expected demand in its core appliance markets in Europe and North America which adversely impacted its first quarter performance. However, based upon customer comments, we expect a recovery in performance during the rest of the financial year, particularly in the second half. 

 

Financial position

At 30 June 2011, the Group had net cash totalling £253 million. The £95 million reduction in the quarter was due mainly to an expected working capital outflow related to large projects in Invensys Operations Management and Invensys Rail, deficit reduction payments into the US and UK pension schemes and a number of other non-operating outflows including for the acquisition of the minority interest in a Chinese subsidiary, Shanghai Foxboro Company Limited.

 

 

Contact:

 

Invensys plc            Steve Devany                    tel: +44 (0) 20 3155 1301

                             Annabel Michie                   tel: +44 (0) 20 3155 1303            

 

Financial Dynamics    Andrew Lorenz

                             Richard Mountain                tel: +44 (0) 20 7269 7291