Spirax Group shares drop 10% after unchanged full-year forecast

Shares in Spirax Group fell 10% on Friday after the industrial engineering company reiterated its unchanged full-year outlook, deflating expectations for upward revisions.

The London-listed group, which provides steam system solutions for industrial applications, reported first-half results that met analyst expectations but offered no changes to its financial guidance for the full year. Revenue rose 5% year-on-year to £312 million, while operating profit increased 7% to £68 million, both in line with market forecasts.

Spirax Group said demand remained resilient across its key markets, including food and beverage, healthcare, and oil and gas. However, management cited ongoing macroeconomic uncertainties, including inflationary pressures and supply chain constraints, as factors preventing any revision to its financial targets.

The company maintained its full-year revenue guidance of £620-640 million and operating profit outlook of £135-145 million, unchanged from its previous forecast. Analysts had anticipated potential upward adjustments given the positive first-half performance.

The unchanged outlook disappointed investors who had priced in more optimistic guidance following the strong first-half results. The stock, which had gained 12% year-to-date prior to the announcement, erased those gains in a single session.

Spirax Group’s CEO, Jonathan Widdowson, reiterated the company’s focus on operational efficiency and cost discipline amid a challenging economic environment. The group also highlighted its commitment to shareholder returns, with a 5% increase in the interim dividend to 12.5 pence per share.

The shares closed 9.8% lower at 1,120 pence, marking the steepest single-day decline since March 2023.