Key Takeaways:
Renishaw Plc reported record adjusted operating profit of £152.9 million for the year to June, up 36%, as AI-driven semiconductor equipment demand lifted revenue 14% to £815.8 million and pushed the adjusted operating margin to 18.7% from 15.7%.
"We made excellent progress in FY2026, with growth in all three segments," Chief Executive Officer Will Lee said. "FY2027 has started strongly as we continue to benefit from the current upturn in demand for semiconductor manufacturing equipment."
The Gloucestershire-based precision-engineering group, which trades as RSW on the London Stock Exchange, said growth accelerated through the year, culminating in record fourth-quarter revenue of £244.2 million, 28% above the prior-year period, with a growing order book carried into the new financial year.
Position Measurement, the segment most exposed to chipmaking capital expenditure, generated £260.9 million of revenue, up 26% at actual exchange rates and 29% at constant currency. Adjusted operating profit in the division rose 53% to £71.5 million, lifting its margin 4.9 percentage points to 27.4% — the single largest contributor to group profitability.
Statutory operating profit rose 25% to £135.3 million, a slower pace than the adjusted figure because the year included £18.0 million of redundancy and other one-off costs tied to a cost-reduction programme and the restructuring of the neurological products business. That programme delivered about £20 million of savings, which management credited alongside operational leverage for the margin step-up.
Specialised Technologies was the fastest-growing division, with revenue up 43% to £107.5 million, driven mainly by additive manufacturing systems sold into aerospace and defence customers. The segment swung from a £9.9 million adjusted operating loss to a £4.7 million profit, a 17.6 percentage point margin improvement, and Renishaw said all product lines were profitable for the year.
Industrial Metrology, still the largest division at £447.4 million of revenue, grew 4% as demand for metrology systems and software offset flat sensor sales. Its adjusted operating margin slipped 0.4 points to 17.1%.
Currency worked against the reported numbers. Revenue rose 17% at constant currency versus 14% as reported, and the company said margin improvement of 5.2 percentage points at constant currency was reduced to 3.0 points at actual rates by foreign-exchange headwinds.
Cash and deposit balances rose to £291.0 million from £273.6 million, even after dividend payments, tax, capital expenditure and the cost-reduction outlay. Adjusted cash conversion from operating activities fell to 79% from 91% as working capital built up to support record sales. Return on invested capital improved 4.3 points to 17.5%.
The board proposed a final dividend of 65.2 pence per share, taking the full-year payout to 82.0 pence, up 5%, and declared a special interim dividend of 70.0 pence.
Renishaw's results land in the same demand cycle that has driven order growth at semiconductor equipment makers including ASML and Applied Materials, and alongside UK engineering peers such as Oxford Instruments and Spectris that sell into similar research and industrial end markets. The company said average through-cycle revenue growth has risen to 8%, a five-year compound rate since FY2021.
For holders, the signal is that the margin recovery is being driven by mix — higher-margin Position Measurement and additive manufacturing revenue — rather than by volume alone, which gives the 18.7% group margin a better chance of holding if semiconductor capital spending stays firm. The next test comes with the first-quarter trading update, when investors will look for confirmation that the order book built in the June quarter converts into revenue and that the £20 million of cost savings annualise.
This article is for informational purposes only and does not constitute investment advice.
