The Weir Group (WEIR) H2 2024 earnings summary

Executive summary

• Announced the acquisition of Micromine, a leading mining software company, to accelerate digital strategy and enhance recurring revenue streams, alongside 2024 full-year results.

• Achieved strong operational and financial performance in 2024, with margin expansion and robust cash generation, despite a slight decline in revenue year-over-year.

• Performance Excellence programme delivered cost savings ahead of plan, supporting margin expansion and cash generation, with the savings target upgraded to GBP 80 million by 2026.

• Strategic progress in 2024 included major contract wins, new technology launches, and sustainability achievements, including a 27% reduction in CO₂ emissions since 2019.

Financial highlights

• Orders increased by 2% to GBP 2.5 billion; revenue decreased by 1% to GBP 2.5 billion due to OE delivery phasing and exit from Russian operations.

• Operating profit rose 9% to GBP 472 million; operating margin expanded 170 bps to 18.8%.

• EPS increased 4% to GBP 1.20; free operating cash conversion reached 102%, up 17 percentage points year-on-year.

• Net debt to EBITDA reduced to 0.7x; ROCE increased to 19.3%.

• Full-year dividend increased to GBP 0.40 per share, up 4% year-over-year.

Outlook and guidance

• Entering 2025 with strong momentum, expecting mid-single digit revenue growth, ~50 bps margin expansion, and free operating cash conversion between 90%-100%.

• Confident in delivering operating margins sustainably above 20% by 2026, excluding Micromine.

• Micromine acquisition expected to be EPS accretive in 2026 and ROIC above WACC by 2028.

• Capex and lease spend projected at ~GBP 100 million; effective tax rate around 28%.