SHARES in Weir Group closed up more than six per cent after the engineering giant underlined its confidence of achieving further profit and revenue growth this year and beyond amid buoyant conditions in the global mining sector.

Chief executive Jon Stanton declared Weir was well positioned in the “right markets” as he highlighted the role its technology can play in decarbonising the mining industry and supporting global demand for precious metals.

Mr Stanton delivered the glowing assessment of the outlook as Weir, which provides parts and services to the mining industry around the world, reported a 21% rise in revenue to £2.47 billion, amid record demand for spares and equipment, in 2022. That helped lift pre-tax profits by 24% to £260m.

Analysts at Shore Capital said the results for 2022 were around 4% ahead of market consensus.

And Weir declared it was confident of delivering further revenue and profits growth this year. Mr Stanton stated that he has a “high degree of confidence” that Weir will meet its target of a 17% rise in operating margin in 2023, as it reaffirmed to the City yesterday.

“We feel good about what’s coming in 2023,” Mr Stanton told The Herald. “We entered the year with a record order book, so we have got that to deliver. Our markets remain strong and active. We have got a good opportunity pipeline so at this point in time our aftermarket business will grow in the range of mid to single digit [percentage points]. Original equipment sales will be broadly stable.

“What we have done this morning is to reiterate our margin target of 17% for 2023. I have a high degree of confidence of delivering that.”

Weir reported that aftermarket orders had increased by 17% during 2022, noting that it had capitalised on growth within its installed base and mining production trends. Orders for original equipment grew by 3%.

Mr Stanton expressed satisfaction that Weir had worked through widespread uncertainty in the global economy to outperform its markets.

And he said the technology provided by Weir to help customers reduce energy and water consumption, alongside the global demand for precious metals needed for electrification as the economy transitions away from fossil fuels, position it well for future growth.

Declaring that Weir had “really powered through” a “lot of complexities” last year, Mr Stanton said: “We are getting a clear run and our strategy is gaining traction. Obviously our markets were positive and favourable with generally high levels of activity. But I think we outperformed the markets thanks to our presence on the ground but also the broader growth initiatives that we have to bring new technology to market, to extend our market share and install base across our customers.”

Noting that the firm’s performance was bringing “flexibility” to its balance sheet, Mr Stanton added: “The future really is bright for us. It really is about growth from here. We have got a very clear strategy with the focus that we have now to build the business further. We have got some great tailwinds behind us with net-zero and decarbonisation trends driving increasing demand for copper and the other battery metals which will be a very powerful theme.

“But also, we are supporting an industry which needs to do things differently and cut its energy and water consumption, which is going to require new technologies. That’s where it really plays into a good old engineering company like Weir. We’re now very much focusing our research and development on those themes to help our customers meet their objectives of getting to net zero and significantly reducing their emissions over the next few years.”

Asked if Weir would target acquisitions as part of its strategy, Mr Stanton said it would be interested in deals if they could “accelerate” its own R&D activity. He noted that 2022 had seen a first full-year’s contribution of Motion Metrics, a technology company that “puts eyes across the mine”, following its acquisition by Weir at the end 2021. “It’s a very powerful technology and we have been really delighted with how that has performed [and] how we have managed the integration,” he said.

Mr Stanton said Weir had been able to avoid the energy price hikes that have plagued European countries largely because its manufacturing takes place in countries that had not seen prices rise to the same extent. He flagged that other inflationary pressures such as freight had started to ease but noted that this year would see see upward pressure on pay as salary rises are put through to help employees deal with inflation.

He noted that Weir had been successful last year in putting price rises through to customers in order to protect its margins.

Meanwhile, Mr Stanton confirmed Weir has now fully wound down its business in Russia. However, operations are running in Ukraine, with Mr Stanton stating Weir is “doing everything we can to support” staff.

He said Weir was focused on ensuring the lives of its employees in Ukraine carried on as normally as possible “among the horror of everything that is going on”.

The Weir board recommended a final dividend of 19.3p per share. That would take the full-year dividend to 32.8p, up 38% on 2021.

Shares closed up 119p at 2,018p.