Historic Scots firm Weir secures £36m order from one of world’s largest exporters of iron ore pellets

Weir Group, the Glasgow-headquartered global mining engineer, has secured a £36 million contract to supply its technology to one of the world’s largest exporters of iron ore pellets.

News of the order from FTSE-250 listed Ferrexpo came as Weir said it had made a good start to the year against the backdrop of “ongoing Covid challenges”.

The Scottish group, which celebrates its 150th anniversary this year, will supply high pressure grinding rolls and screens as part of its initial order with Ferrexpo as it looks to increase output from its operations in Ukraine from 32 million tonnes per annum to more than 80 million.

Detailed test work with Weir’s technology is said to have showed “significant” capacity and environmental benefits.

Mining group Ferrexpo is one of the world’s largest exporters of iron ore pellets to the global steel industry.

Jon Stanton, Weir Group chief executive, said: “This is a great endorsement from one of the world’s leading miners of the key role Weir’s technology has in making mining operations more efficient and sustainable. It is also an excellent example of the benefits of working in partnership and using innovative engineering to increase productivity and reduce emissions.”

Jim North, interim chief executive of Ferrexpo, added: “We are delighted to be partnering with Weir for the next phase of our growth programme, with high pressure grinding rolls being a great example of utilising modern technology to help us grow our business.”

In a trading update for the first quarter, Weir revealed an 11 per cent increase in group orders from continuing operations.

There was a 67 per cent increase in original equipment orders though aftermarket orders fell 2 per cent reflecting “residual Covid disruption to ore production”.

Stanton told investors: “The group has had a good start to the year against the backdrop of ongoing Covid challenges.

“As expected, conditions continued to improve in both mining and infrastructure markets reflecting increasing customer confidence in a broad-based economic recovery and near record prices for commodities essential to growth and carbon transition.

“This was reflected in continued positive development in our project pipeline and improving order conversion of our early cycle product lines and technologies that deliver significant sustainability benefits.

“Looking to the full year, we continue to expect to deliver growth in full year constant currency profits in line with current market expectations.”

The group is now in its 150th year, having been founded in 1871 by two Scottish engineers, James and George Weir. Globally, the business has some 11,000 employees operating in more than 60 countries.

Analysts at investment firm Shore Capital said: “Mining production levels remain below Covid-19 levels as some regions are still being impacted by the pandemic/limited operations.

“However, demand across North America, Central Asia and Africa was the strongest while across the Asia Pacific and South America were more ‘subdued’.

“We have seen mining peers rerate as the market conditions have improved given supportive commodity prices and an easing of global lockdown restrictions.”

They added: “We retain our buy recommendation in a premium mining-focused business with long-term structural drivers given the expected transition of the mining industry to adopt more technological, sustainable, efficient, and environmentally friendly practices.”

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