Ricardo wins three major engine jobs

By close of trading on the London, UK, stock market on Friday (21 May) the share price of Ricardo plc had reached a 52-week high of 915 pence; an increase of 31 per cent on the price on 9 February 2015 when it was 697 pence - and thus outperforming the market. The day previously (20 May) Ricardo issued a trading update showing a record order book.

Ricardo says that its results for the first six months of this year show a good start to the second half of the financial year with order intake in the four months to the end of April £23 million higher than the same period last year.

The order book at the end of April was £152m compared to £141m at the same time last year.

Significant orders won in the last four months include three engine design and development projects for customers in Asia.

Ricardo has also won two vehicle development projects across the UK and Europe and a contract for the UK Government in its environmental consulting business.

In the US, orders continue to be slow in Ricardo’s traditional automotive market but the company claims “a good pipeline” is developing in the defence sector.
 

Total group revenue in the 10 months to the end of April is up 6 per cent on the same period in the prior year and profit is “tracking” in line with the company’s full year expectations.

In Ricardo’s business segments, Technical Consulting continues to perform well and the company claims Performance Products is on track with its preparations for the new McLaren contract next year.

By the nature of Ricardo’s business there are some important contracts the company has won that it is restricted from releasing until it has permission from clients, however much as it would like to.

Ricardo says it is “on track” with its acquisition of Lloyd’s Register Rail and expects to complete the transaction on or before 1 July 2015.

The group claims it “continues to maintain a robust balance sheet” with bank facilities in place for completion of the acquisition.

Dave Shemmans, chief executive officer, says “The strong order intake in the last four months has resulted in another record order book and I am particularly pleased with recent wins in Europe and the continued growth of our business in Asia.” Shemmens adds that the “US is currently a challenging market, but I am encouraged by the medium-term opportunities particularly in the defence and rail sectors.  Overall, we remain confident of continued progress in the rest of the year.”