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Renishaw shares expected to slump after second annual forecast cut

(Reuters) - British engineering group Renishaw Plc on Tuesday cut its full-year profit forecast for the second time in 2019, citing lower customer orders that hit sales in the first nine months of the fiscal year.

Shares of the FTSE-250 company are expected to fall as much as 10%, according to premarket indicators. The stock fell nearly 18% in 2018.

Renishaw makes precision measurement equipment used in products ranging from jet engines and smartphones to medical equipment and satellites through its metrology business and had warned in January that the unit was facing weak demand.

In the nine months ended March 31, sales from its metrology unit, which accounts for most of its revenue, fell 0.5%, while a double-digit growth in its healthcare business was not enough to boost sales.

Revenue from the company's continuing operations rose 0.3%.

Renishaw has also been hit by weak sales in Asia from where it makes nearly half its revenue.

The company now expects annual adjusted profit before tax between 105 million pounds ($135.99 million) and 120 million pounds.

Renishaw on Tuesday also trimmed its full-year revenue forecast to a range of 580 million pounds to 600 million pounds.

The company in March cut its profit forecast to between 117 million pounds and 135 million pounds and total revenue expectation to a range of 595 million pounds to 620 million pounds.


($1 = 0.7721 pounds)


(Reporting by Pushkala Aripaka in Bengaluru; Editing by Shounak Dasgupta)