http://groupintranet.weir.co.uk
Weir Bulletin 3
From the Chief Executive:
Delivering growth the Weir way
As I take on the role of Chief Executive, I am resulting in higher gas storage levels, reduced Driving growth
excited at the range of growth opportunities rig counts and reduced prices. There were a Our immediate priority for 2010 is to extend
open to the Group and to share with you, in my significant number of project opportunities in operational excellence beyond the factory
first article for Weir Bulletin, that we have the downstream market, principally driven by floor into functional areas that have a direct
delivered a record set of results for 2009 clearly expansion of refining capacity in the Middle impact on our ability to grow and that support
demonstrating the quality and resilience of our East, although Middle East service operations the continued drive for greater customer focus.
business model. A higher proportion of were impacted by reduced production The Weir Commercial System and the Net
aftermarket revenues and a growing volumes. The division has performed well in Promoter Score methodology will be extended
contribution from emerging markets mitigated these market conditions, managing costs and during 2010 and both complement the Weir
the impact of reduced demand for original driving greater operating efficiencies. Production System that has delivered such good
equipment products. We delivered an Power & Industrial made good progress in results in manufacturing. All of these tools
exceptional cash performance and enter 2010 developing its presence in global power contribute by sharpening customer focus and
in robust financial health. markets with a clear focus on nuclear and ensuring operational efficiency.
We benefit from exposure to positive end hydro. A growing contribution is being made With operational excellence prioritised
markets, geographic strength in emerging from sales to emerging markets, especially throughout the business, we will generate growth
markets and a presence at the heart of the China and increased plant utilisation and through three key drivers.
processing cycle. All these characteristics increase operational efficiencies are reflected in First, we will drive product sales through
our strength and give us confidence for the improved operating margins. innovation and creativity. We will continue to
future. The success of any business is down to its During 2009 we continued to make good take an innovative approach to the research,
people and as I visit our operations, I am most progress against a number of our key priorities: testing and development of new materials and
impressed at the very evident commitment, • Our focus on health and safety resulted in a products. Besides taking new products to existing
pride and passion of every one I meet. 52% reduction in lost time accidents, which markets and customers, we will proactively take
was an excellent result, but one that needs to our existing and developing portfolio to new
2009 performance be repeated as we move towards a target of markets and customers.
Overall order input was down 18% while zero lost time accidents Second, we will support collaboration in the
aftermarket input was down 2%, reflecting • Our on-time delivery improved by 10% on form of co-operative alliances and cross-divisional
production activity levels in our main markets the back of good focus across the divisions initiatives to promote our total capability for
offset by our growing installed base and the • An exceptional working capital reduction of customers in all markets and to leverage off best
greater importance of maintenance and £66m, converting into cash. practice across the Group. We will continue to
refurbishment of existing equipment. We continued to invest in product research build customer partnerships and add value by
Profit before tax from continuing operations and development. Minerals completed design delivering innovative engineering solutions, with
before intangibles amortisation increased by work on pump enhancements. Weir SPM an integrated service offering and enhanced
6% to £187.0m from £176.2m in 2008, while launched the Safety Iron Manifold Trailer and organisational capability.
operating margins increased from 14.3% to Power & Industrial USA completed customer Third, we will exploit and strengthen our
14.7% reflecting the favourable impact of a acceptance testing of a nuclear grade valve. emerging markets footprint. More than 40%
higher proportion of aftermarket revenues and Over £40m was spent improving operating of Group turnover already comes from
proactive management of the cost base. efficiency and extend the Group’s global developing markets in Asia, South America and
Results also benefited from a positive foreign presence including a new foundry and rubber Africa. There are significant opportunities for us to
currency position with over 90% of the Group’s facility in Brasil and new service centres in North internationalise more products through both our
revenues generated internationally. Our South and South America and Africa. existing and expanding geographical network.
American Minerals operations delivered a
record operating performance and we won a Group strategy Outlook
number of notable contracts in the Chinese With our extensive global presence and The Weir Group today has a superb
nuclear new build and Middle East downstream dedication to operational excellence, we have manufacturing platform, resilient business model
oil and gas markets. We also retained our created a strong platform for growth. Our and enviable market position. This is based on our
Canadian Naval Engineering contract for a strategy is to continue to extend the Group’s reputation for excellent engineering capability
further 15 years. Positive emerging trends at position in three global markets: Minerals, Oil & and the quality of our people.
Weir SPM were also evident towards the end of Gas and Power & Industrial, all of which are all As we enter 2010 the Group is in robust
the year. high growth, long cycle markets with positive financial health and well placed to capitalise on
Despite the global economic downturn and fundamentals. market opportunities.
associated decline in commodity prices, This strategy will be delivered through
Minerals continued to perform strongly sustainable self-made growth, supplemented I look forward to your continued support in 2010.
benefiting from improved operating by skilfully integrated, targeted acquisitions. We
efficiencies, pro-active management of the cost will invest in the technology, infrastructure and
base and the continued development of the people to grow market share and our installed
product portfolio. base of original equipment. This will include
In Oil & Gas, the North American upstream broadening our competitive product portfolio
market experienced a substantial reduction in and added-value services, with the emphasis on
activity with lower demand for natural gas products that provide a strong aftermarket.
Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24