Renishaw Plc Posts 40-Year Record For Revenues

Gross profits up at Renishaw plc (LON:RSW), but operating profits slip as engineer invests in R&D.

Jill Ralph

After more than 5 years with The Motley Fool's publishing business in the U.S., Jill packed up and moved to London in the Spring of 2011 to join the team as Managing Director. It didn't take her long to start complaining about the weather. When she's not taking advantage of the generous 'free book' program at work, she enjoys studying and writing about companies of all shapes and sizes, with a particular interest in the people running those businesses and refusing to play by the rules. Before joining the Fool, Jill spent 5 years in the publishing industry, working on the news team for a regional newspaper as well as Managing Editor of a niche B-to-B magazine.

Published 24 July, 2013 10:57 am BST

| More on: RSW

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As Renishaw (LSE: RSW) marks its 40^th anniversary, it also has another reason to celebrate: a record year for revenues, at £346.9 million.

The specialist engineer, which produces measurement and sensor devices that are used across a wide range of industries, saw gross profits increase to £182 million for the six months ending June 30.

But total operating profits actually slipped 5% to £81.9 million, Renishaw reported, as the overall cost of sales climbed and general distribution costs increased. Renishaw saw a 12% increase in distribution costs as it opened its 11^th office in China and recruited another 94 sales and marketing staff.

A company like Renishaw relies on innovation, and must support that by spending on research and development and the plants and equipment to build its metrology devices.

For the six-month period, Renishaw invested £28 million in property, plant and machinery expenses across England, Wales and Ireland. It also reportedly spent another £51.8 million on engineering, research and development, and manufacturing processes.

Renishaw reported adjusted earnings per share was 91.4 pence, down from 95.6p last year. Renishaw also declared a final dividend of about 29p net per share, resulting in a total dividend for the year of 40p net per share.

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> Jill does not own shares in any company mentioned. The Motley Fool has recommended shares in Renishaw.