Renishaw "2026 CMD reassures on financial targets and points to upside to..."

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Renishaw "2026 CMD reassures on financial targets and points to upside to..."

Renishaw UBS Research

Key takes / highlights from the cmd

We show the breakdown of the addressable market in the charts below:

Figure 1: Renishaw's est. addressable market (£7bn) Figure 2: Breakdown of addressable market (£7bn)

Breakdown of add

res

le market (£7bn)

Source: Company data Source: Company data

Margins: During the CMD there were several questions on the ability for the

company to get back to margins of 20+% (from 16% in FY25) and how attainable

this target is. In our view, management clearly articulated how they intend to get

to 20%+ over the medium-term through operating leverage, smarter pricing as

well as simplification and efficiency measures.

Cash improvement: Mgmt. explained that cash conversion is a focus point in the

near term, and management intend to deliver improved cash conversion through

working capital efficiency as a percentage of sales and non-production-related

capex (ie property) in order to drive higher cash improvement.

Market share: Renishaw estimates that it has12% market share within their

identified £7bn addressable market

Increased focus on pricing going forward: Mgmt. highlighted that a key lever

for growth and margins will be "smart pricing", or, in other words being more

strategic and targeted with pricing.

Additive Manufacturing (AM) makes up the majority of Specialised

Technologies (11% of group) and is the fastest growing subsegment of the

business with aerospace & defence (35%), medical & dental (28%), as well as

consumer electronics (6%) being strong growth contributors. Mgmt. explained

that they were seeing a strong order momentum, which they will be able to meet

as the company's manufacturing site in Miskin, South Wales can easily ramp up