6 September 2018 – investor roadshow update
The company is undertaking a investor roadshow in London to discuss its half year results and strategic progress following the completion of the ESCO acquisition. Following updates from industry peers in recent days the company expects to cover current North American oil and gas market conditions, which were in line with management expectations through to mid-August. In the last two weeks of August activity levels supporting Weir Group’s Oil & Gas aftermarket business remained as expected but there were initial signs of pricing pressure. Perhaps more importantly, there was a ‘considerable softening in demand for original equipment and some order book delivery deferrals’. No further information on current trading will be provided as part of the roadshow but this has been enough to hit the share price. Nevertheless, we keep our BUY recommendation for now.