Vesuvius (LSE:VSVS) delivered a modest increase in first-half 2026 revenue, with adjusted sales rising at constant currency, while free cash flow improved significantly, helping reduce the group’s leverage. However, statutory operating profit and earnings declined as temporary operational issues within the Steel division and weaker performance in the Advanced Refractories business weighed on overall profitability.
Although steel markets outside China continued to recover, the company said operational disruptions prevented its Steel division from fully benefiting from stronger demand. Pricing discipline and ongoing structural cost-saving measures provided some support during the period but were not enough to offset the impact of these challenges.
Foundry Division Delivers Strong Performance
The Foundry division was the standout performer during the first half, recording solid growth in both revenue and trading profit. The improvement was driven by positive pricing, continued cost reductions, market share gains and the contribution from the MMS acquisition.
Management also highlighted progress in improving cash management, investing in research and development, and delivering additional structural efficiency initiatives. The company maintained its interim dividend and said actions are underway to resolve the operational issues affecting the Steel division.
Full-Year Outlook Remains Positive
Despite the softer first-half earnings performance, Vesuvius expects full-year trading profit to be slightly ahead of 2025 on a constant currency basis. Management believes improving operational execution, combined with ongoing efficiency measures and stronger end-market conditions outside China, should support performance during the remainder of the year.
Investment Outlook
Vesuvius continues to benefit from its strong market position and improving cash generation, while its dividend yield and moderate valuation provide support for investors. However, pressure on profit margins, lower returns on equity, softer cash conversion and weaker short-term technical indicators remain areas of concern. The company’s ability to resolve operational issues within the Steel division will be an important factor in delivering its full-year expectations.
About Vesuvius
Vesuvius plc (LSE:VSVS) is a global provider of molten metal flow engineering solutions, supplying advanced refractories, flow control products and related technologies to customers operating in high-temperature industrial processes. The company also provides technical services and data-driven solutions through an international network of manufacturing facilities and technology centres located close to customer operations.
Vesuvius serves customers across the global steel and foundry industries, focusing on improving manufacturing efficiency, safety and sustainability. Its strategy is built on technological leadership, long-standing customer relationships, a strong presence in developing markets and continued investment in innovation to support long-term profitable growth.
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