Industrial metrology boosts Renishaw's earnings

After a bumpy start to 2021 in which Renishaw put up the for sale sign up and subsequently took it down, the British engineering-firm kicked off its 2022 interim report with news of a hugely successful 6 months to end 2021.

The six months leading up to 31 December 2021 saw the company’s revenue up 27% compared to the previous year, now £325.2 million. Notably after a couple of year’s of restructuring, which saw the loss of a reported 600 jobs, the company profit was up to £84.2 million compared to £43.4 million in the same period the previous year.

"We achieved very strong revenue growth in all regions and there was growth for all product lines within our Manufacturing technologies segment, most notably for the encoder and gauging lines,” said Executive Chairman, Sir David McMurtry, during the company’s half-year results webcast. “The strong demand for our encoder product lines continues to be driven by increased investments in industrial automation and the semiconductor and electronics capital equipment markets, while our gauging line is benefiting from a recovery in metal cutting operations and increased investments in shopfloor metrology."

Renishaw's future looked uncertain just six months ago, as the company's octogenarian founders and two majority shareholders, Mr McMurtry and John Deer, withdrew the company from sale.

At the time of withdrawal the founders said: "As the founders of Renishaw, we understand the importance of Renishaw's culture, our place in the communities in which we operate, our commitment to research and development, and the loyalty of our staff, our suppliers, and the customers we serve; these together have been the foundation of our success for almost 50 years.

"With the board, we are therefore focused on ensuring that we find the right new owner for our business - one who respects and will continue to nurture these important attributes."

For the first six months of last year, revenue for Renishaw's manufacturing technologies division, which includes Industrial Metrology, Position Measurement, and Additive Manufacturing businesses, was £308.7 million, up from £236.9 million in 2020. Adjusted operating profit was £81.3 million, up from £41.1 million at the same time last year.

The half-year report states that demand for all Renishaw’s manufacturing technologies product lines ha increased, particularly for gauging and magnetic and optical encoder product lines.

Due to significant global investments in the semiconductor and electronics capital equipment market, the latter has seen strong growth, driven by an increase in both consumer and commercial demand for electronic products, the growth of electric vehicles with more sensors than conventional vehicles, and the desire for more countries to become self-sufficient in semiconductor manufacturing.

Finally, Renishaw says that global supply chain issues that affected the financial year of 2020/21 are still present, owing to a scarcity of electrical components. However, Renishaw boasts significant in-house manufacturing activities, proactive inventory management, and continuous assessment of alternative components offset these risks.