Engineering company Weir has posted a 50 per cent rise in first-half pretax profit - and said strong commodity and energy prices made it increasingly confident.
Weir, which makes pumps for moving minerals, oil and sea water, said pretax profit, adjusted to exclude restructuring costs for the 26 weeks to the end of June, was £37.2 million, compared with £24.8 million the year before, as revenue rose 24 per cent to £438.2 million.
Operating profit was 44 per cent higher than a year ago at £38 million.
Chief executive, Mark Selway said: "I think this improved performance again shows the strength of the end markets of mining, power generation and oil and gas. Geographically we are seeing strength across all of our markets. We've got increasing confidence in the outlook for the year."
The company's shares, which had already risen over 16 per cent since the beginning of 2006, were up another 6.1 per cent at 467p after the announcement.
Mr Selway said he expected analysts to lift full-year forecasts for the firm following the strong first-half showing.
He said: "The top (pretax profit) estimate from the industry was about £76 million for the full-year, and I think most people are now indicating we will be about seven per cent above that, which works out roughly at about £82 million and I don't feel uncomfortable with that for a positioning for the group."
Weir said a key driver for the improved performance had been the minerals division, as its customers rushed to exploit spiralling global commodity prices and after it landed a £9.1 million deal with Canadian Natural Resources for equipment to extract oil from oil sands.
The Glasgow-based company, which is in the final stages of a £31 million restructuring programme, said it had seen something of a turnaround in its UK valves and clear liquids division following the changes.
Mr Selway said: "The benefits of that (restructuring), both in terms of our UK valves and pumps business, is starting to come through in terms of cash and profit performance."
Margins in the firm's engineering products business rose to 9.5 per cent from 7.2 per cent in the prior year.
Mr Selway said he expected that to reach around ten per cent by the end of the year.
The firm added it would raise its interim dividend six per cent to 3.75p per share, though on the downside it expected sales in the Middle East to be hit by the ongoing geopolitical tensions in the region.
Altium Securities analyst John Dean retained his "buy" guidance on the stock.
He said: "Weir's interim results have delivered exactly what we had hoped for; better-than-expected progress in the core businesses and indications that momentum in its operations and markets continues to be positive."
Analysts at Numis raised the stock to a "buy" from "hold" after lifting 2006 and 2007 estimates for the company.