Weir Group Stock

Good morning, everyone, and many thanks for joining the call today to discuss our results for the first half of 2026. Before we start, I'd like to draw your attention to the usual cautionary notice on forward-looking statements.

We have a lot to share today, but before we dive into our results for the half, I'd like to hand you over to Andrew Neilson, who will be taking over the reins as CEO next week to say a few words. After we hear from Andrew, I'll start with some of the key highlights of the first half performance and the progress that we've made against our key strategic priorities. Brian Puffer, our CFO, will then run through the numbers in more detail and finish our outlook, after which I'll give you some closing remarks before taking your questions. So with that, I'll hand over to Andrew.

Good morning, everyone. I'm very excited to be picking up the baton from Jon and leading a business of Weir's quality, heritage and potential. I've been with Weir for 16 years and have worked across all areas of the business from strategy and M&A to integrating and leading ESCO and most recently heading up our Minerals division. That experience has given me a deep understanding of our markets, our customers, our operating model and the rich capabilities that differentiate Weir from our peers.

It has been a privilege to work so closely with Jon over the last decade, helping transform Weir into a focused mining technology leader. Today, our strength is underpinned by a stronger, more resilient portfolio that now comprises both hardware and software solutions. That is opening up more and more opportunities to help customers all around the world respond to the rising demand for critical minerals, sustainable practices and responsible CapEx. As Chief Executive, my focus will be on seizing this multi-decade opportunity.

My priority will be to build on what we have started, driving our performance with stronger execution and delivering on the recent investments that we have made whilst continuing to unlock operational efficiencies and deploy capital to accelerate our future growth. We are the proud engineering heritage, but what excites me most is the future. We have the customer relationships, technology platforms, operating discipline and deep capability to help shape the next generation of mining.

If we execute well, we can support customers in producing the resources the world needs while delivering sustainable compounding value for shareholders. So it's a big opportunity ahead, and it's one I'm very excited to lead. I look forward to meeting you in the months ahead. But for now, let me hand you back to Jon and Brian to take you through the results.

Thank you, Andrew. You're certainly taking on the CEO role at a very exciting time for Weir, and I look forward to seeing the business continue to flourish under your leadership. I'm going to start today's presentation with a summary of our performance and strategic progress before we go into a deeper dive specifically on our growth drivers and competitive positioning.

In short, our financial performance for the first half reflects a real acceleration in Q2 orders amid strong market activity levels, putting us exactly where we need to be to deliver on our full year guidance. Brian will take you through the details shortly, but let me provide the headlines, which sets the context for the remainder of my presentation.

First, to orders, where we've grown 8% year-on-year on a constant currency basis. And that's against a very tough 2025 comp, which included the GBP 40 million Talabre's order and a heavy first half weighting to aftermarket orders last year. Original equipment orders grew by 10% year-on-year, supported by a high bid conversion rate on projects, over 90% success rate in pump trials, consistent with our historic average and excellent progress with new product penetration, particularly in comminution.

Aftermarket orders grew by 8% with strong activity in our largest Minerals exposure of copper, gold, iron ore and oil sands, and we saw the expected bounce back from the weather-related disruptions of the first quarter. The key point to highlight is the Q2 aftermarket organic orders of Minerals, up 8% year-on-year, back in line with our expected mid- to high single-digit range and ESCO saw similar organic growth in Q2. And together, that puts us on track to meet our full year growth expectations after the slow start in Q1.

Revenue increased by 5% on a constant currency basis as contributions from acquisitions were partially offset by the effect of some deliveries being deferred into the second half following our last round of production transfers within Performance Excellence. Just to give you a little color on that, you'll recall that late in 2025, we commenced relocating rubber parts to production to Malaysia and India as well as castings to the Americas and Africa following capacity reductions in Australia and the U.K. Now as you see on the map, these relocations involve transfers between multiple individual sites within our global operations with several complex movements across continents.

As we progress with the transfers, unusual demand patterns seen in Q1 and early Q2 created a shift in product mix relative to our planning assumptions, which pushed out production and deferred deliveries. But with production replanned and a return to usual demand patterns, we exited June with strong operating momentum, which will allow delivery of delayed orders over the second half. With a book-to-bill of 1.12, we've grown our order book in the first half by circa GBP 150 million and with continuing strong market activity levels entered the second half with strong top line momentum, underpinning our full year guidance.

Turning to profit, where on a constant currency basis, adjusted operating profit was stable and resulting operating margins were 18.8% against a very strong comparator with mix effect and the delivery deferrals I just mentioned more than offsetting first half Performance Excellence benefits. However, with the first half headwinds largely reversing over the remainder of the year and good line of sight on delivery of the remaining savings within Performance Excellence, we continue to expect operating margins above 20% for the full year.

And finally, free operating cash conversion of 41% reflects an increase in working capital, supporting second half order book delivery and production transfers as well as the on-market purchase of shares for our LTIP awards during the first half. Again, these effects will unwind or normalize over the balance of the year, and we expect to deliver cash conversion of between 90% and 100%, in line with our established track record. Now just a few comments on current market conditions.

In terms of mining CapEx, we're seeing accelerating growth and activity in our project pipeline, particularly in North and South America, where permitting is becoming more supportive of new mining activity. We've seen early packages awarded in North America and more are coming in South America over the next 12 to 24 months. As the industry grapples with the delivery of new mines, the challenges of capital efficiency, mine productivity and social license to operate are acute. So it's really pleasing to see the increasing customer focus on innovative hardware and software technologies as projects move through feasibility into the planning stage. Meanwhile, the focus on improving the efficiency, productivity and sustainability of existing resources continues unabated.

Looking at OpEx, as I said earlier, we've seen a normalization of demand patterns since Q1 and see healthy underlying production growth in our big 4 exposures of copper, gold, iron ore and oil sands. One of the bright spot is the planned start-up of mothballed hard rock mines, particularly lithium in Australia. Geopolitical activity has affected some of our smaller markets, but overall, we expect the current positive conditions to continue, supporting continued growth in orders over the course of the second half.

Now turning to strategic progress so far this year. The foundation for everything is the safety and wellness of our people. And while our total incident rate is stable so far this year, we're gaining traction with the improvement priorities I recently set out, which is reflected in fewer first aid cases and lower severity rates across the business. Beyond physical safety, we've again been recognized by CCLA in Tier 1 of their employee mental health and well-being benchmark, placing 6th among the largest companies in the U.K.

We're making great progress on technology to expand our addressable markets with new solutions, but also to protect and extend our competitive advantage in core products. New solutions brought to market include the Optimil vertical stirred mill or VSM. And in core products, we launched our next-generation mill circuit pumps and construction GET, both of which will deliver step changes in efficiency for our customers, which I'll talk about in more detail later. On sustainability, we released our updated climate transition plan earlier this year, and our leadership continues to be recognized with CDP awarding Weir an A score for climate transparency for the fourth consecutive year.

Our progress with acquisitions continues at pace. Deals completed in 2025 continue to perform in line with expectations with Micromine on track to deliver growth in annual recurring revenue of more than 25% this year, supported by our global cross-selling initiatives, which I'll also touch on later. In March, we completed the acquisition of the remaining 50% share of our Chile-based joint venture, ESEL, unlocking the opportunity to grow market share by direct sales in the world's largest copper-producing region.

Longer term, and as we set out at our Capital Markets event last December, our focus is on delivery of the growth potential that's been unlocked by the transformation of Weir over the past few years. And we're making good progress. Our new products are driving the core business toward higher market shares and creating new market leadership positions as we expand our flow sheet solutions. We're positioned strongly with new foundry capacity in the fast-growing North and South American markets and Micromine is at the heart of what is becoming a very exciting end-to-end digital value proposition.

While the 2026 focuses on integration and delevering, we're actively building the pipeline of new acquisition opportunities to compound future growth. So with that context set, I want to turn into a more detailed review of the growth prospects for Weir, starting with the outlook for the mining market.

Now across the business, we're actively pursuing more than 2,000 projects across all commodities and regions with copper and gold across the Americas being the standouts. This is going to be supportive of robust future OE order intake and will drive ongoing growth in our installed base and therefore, aftermarket opportunity. Likewise, the projected production trends, which further underpin aftermarket growth are positive.

On a revenue-weighted basis, we expect to see growth in copper, iron ore and nickel drive overall demand for aftermarket spares and expendables with coal the only negative but now a very small market for Weir. Declining ore grades will also be an ongoing factor as new lower-grade mines come online. So our markets are growing. And within those markets, our core pump and GET businesses retain their market leadership and competitive position, both are growing market share.

Minerals remains the clear #1 in processing and mill circuit pumps with more than 50% market share, well ahead of our competition, driven by our differentiated technology and customer intimacy. Our market share grew in the first half, where we won over 2/3 of new large pump tenders and maintained our aftermarket capture rate. Our success extended to competitive mill pump trials, where we won 13 of 14 campaigns, taking our total success rate above 90% for the year, while our recent acquisition of Townley only adds to the opportunity pipeline in North America, which is currently the fastest-growing mining market.

Likewise, ESCO is the global leader in ground engaging tools for mining, again, with clear technology leadership and embedded customer relationships, which deliver the industry-leading total cost of ownership. In the first half, ESCO won over 100 net major digger conversions, an increase of nearly 40% year-over-year, including 3 with new customers in Chile as we drive our go-direct model in that market.

Our competitive success continues to demonstrate the value of our industry-leading total cost of ownership, combining leading edge technology with world-class service. And that's particularly true for our mill circuit pumps with their well-earned and long-standing industry reputation for running harder and longer than any of our competitors. And that's the essence of how we've been successful in over 90% of competitive trials, consistently gaining market share against all of our competitors.

And here are the examples, trial wins in Latin America in large copper and gold applications where we deliver the performance when competitors fall short, landmark wins in China against local competitors when customers see the advantage of total cost of ownership and wins in Africa and Australia, where customers invested in step-change technology to deliver the performance they needed.

Delivering technology today is important, but as with any competitive advantage, you must invest to retain leadership, and that's exactly what we're doing. And I wanted to highlight 2 next-generation iterations of our core products, starting with the newly released MCR squared mill circuit pump, which delivers a step change in operational efficiency of 20% compared to our existing offerings, further extending the lead over our competitors. This significant increase in performance demonstrates the powerful combination of our leading material science, hydraulic engineering and digital capability, and the results have been proven at 3 trial sites as part of product validation.

The MCR squared is protected by 8 patents and day 1 NEXT digital enablement, fitting seamlessly into our existing mill pump business model. And ESCO has developed Vertasys, a next-generation GET solution for the construction industry after trials at 6 customer sites. Vertasys incorporates a unique vertical integrated locking system, which significantly reduces installation time and keeps machines out in the field. Following on the material science from our NEXUS suite of mining GET solutions, several field trials have validated a 15% increase in wear life compared to other offerings and generated significant excitement at the recent product launch.

Now beyond our core products, we continue to invest in bringing new technology into our broader solution set and recently introduced a new Optimil VSM, the latest addition to our Enduron line of comminution products. The engineering team has done a fabulous job bringing a new concept for stirred mills through product development and into the market in less than 12 months. We've now received orders for 10 VSMs already across the product range based on the expertise and credibility of our team, and there's more to come.

What sets the Optimil apart from other comminution solutions is the proprietary grinding mechanism of media, which improve energy efficiency and increase wear life, reducing maintenance frequency and delivering a lower total cost of ownership. As with MCR squared and Vertasys, this technology includes integrated digital automation, has significant patent protection and fits perfectly into our aftermarket intensive razor/razor blade business model. And when combined with the Enduron HPGR on the comminution flow sheet, we see energy savings of up to 40% compared to traditional technologies.

So as you can see, our understanding of what customers need and delivering the right solutions are what keep them choosing Weir for their most mission-critical needs. Our innovative solutions reach across the flow sheet and lower total cost of ownership by providing greater uptime and higher utilization, reducing energy and water consumption. In a recent example in India, a major iron ore producer chose Weir for both their comminution and tailings flow sheets.

Led by our Optimil VSM and GEHO positive displacement pumps, these flow sheet solutions will both increase the energy efficiency of the mine and increase the tailings capacity of the operation, allowing the concentrator to process more rock. India is an exciting market for Weir with domestic iron ore expected to grow fivefold over the next decade. And having this great case study is a strong first step in positioning Weir as a market leader in the country as future projects come to market.

Finally, on the strategic growth road map is software, where Micromine continues to deliver in line with our expectations. Micromine is widely recognized by our customers for its value and performance. And year-on-year, we've increased our customer retention through the release of new feature packages. As we integrate our suite and offer more solutions through the cloud, more customers are adopting recurring licenses, increasing the quality and visibility of our revenue streams.

Our qualified pipeline from warm introductions through the Minerals and ESCO networks has increased by 300% over the last 6 months with the vast majority of these opportunities originating outside Micromine's home market of Australia. We are matching that pipeline growth with dedicated software sales recruitment to ensure we can convert into new license sales and have seen new business at Tier 1 miners in Brazil and Chile as a result of warm introductions as well as significant wins in Kazakhstan and Africa.

The team we're building is a great fit for Weir, and we maintain voluntary employee retention above 90% as we scaled sales force. With strong growth in license sales year-on-year, we're on track for our full year expectations of annual recurring revenue growth above 25%. Taking a step back, Weir offers compounding growth and resilience through the cycle, and we're well on track to achieve our annual commitments to shareholders to outgrow our markets, sustain industry-leading margins and clearly convert earnings into cash and returns, all while doing the right thing for our people and the planet.

I'll return in a few minutes to share some final closing remarks, but we'll now turn over to Brian to go through our detailed financial performance and the outlook for the full year.

Thank you, and over to you, Brian.

Thank you, Jon, and good morning, everyone. As Jon highlighted, our financial performance reflects strong order growth in the second quarter and improving operational momentum as we navigate the current geopolitical backdrop and a series of complex internal production transfers as part of the final work streams of our Performance Excellence program.

In the first half of the year, orders grew by 8% as we saw weather-related mine site issues reverse along with an acceleration in demand during the second quarter. Revenue increased by 5% on a constant currency basis during the first half to GBP 1.3 billion with contributions from acquisitions being partially offset by some deliveries being deferred into the second half. Customer demand patterns, along with preplanned production transfers compounded production complexity, leading to additional costs and a lower mix contribution throughout the first half of the year.

While operating profit was stable, operating margins decreased by 100 basis points to 18.8% against a strong prior year comparator. Profit before tax of GBP 196 million declined versus the prior year as we saw the annualized impact of higher interest costs relating to our recent acquisition activity. Free operating cash conversion of 41% reflects higher working capital outflows as we grew stocks to support order book phasing and production moves. In addition, we purchased 100% of our shares required for LTIP awards in the first half of 2026.

We expect working capital to unwind in the second half and together with growing profitability, remain on track to deliver our full year guidance of 90% to 100% cash conversion. Net debt to EBITDA was 2.2x, primarily resulting from cash flow phasing. We expect our leverage to revert back toward our stated debt covenant range of 0.5 to 1.5x at year-end as the working capital build unwinds in the second half. Finally, our proposed interim dividend of 20p per share represents a 2% increase year-on-year and reflects our confidence in achieving our full year guidance.

Turning to Minerals. The division delivered excellent order growth in Q2, supported by healthy activity across key mining commodities, particularly copper, gold, iron ore and oil sands. We also saw continued demand for our market-leading technology portfolio, while operational performance improved steadily throughout the year as we work through the mix and production transfer challenges.

Orders increased by 7% on a constant currency basis. Original equipment orders grew by 9%, reflecting continued investment by customers and strong demand for our differentiated solutions. Aftermarket orders increased by 7%, supported by positive activity levels across our major mining markets. Book-to-bill was 1.15 at the end of June. Revenue increased by 3% on a constant currency basis to GBP 900 million, reflecting contributions from Townley and improving operational momentum as we deliver the order book.

As mentioned earlier, reduced volume from unusual demand patterns in Q1 and early Q2, combined with the rescheduling of thousands of SKUs leading to inefficiencies in our manufacturing plants. As a result, operating profit decreased by 5% on a constant currency basis to GBP 181 million, with margins reducing by 170 basis points to 20.1%. With demand patterns returning to usual and production replan, we expect to deliver these backlog orders over the second half.

Moving on to ESCO. The division delivered another strong performance, benefiting from healthy mining activity and contributions from our software solutions business. Micromine and Fast2Mine performed in line with expectations with Micromine remaining on track to deliver annual recurring revenue growth of more than 25% in 2026. Orders increased by 10% on a constant currency basis. Underlying demand remained positive across mining markets with strong growth in original equipment driven by mining bucket demand, particularly in North America and Australia.

Aftermarket demand also improved through the period, supported by mining and construction activity and the return of dredging orders in the Middle East. The division delivered a book-to-bill ratio of 1.05 with mining markets accounting for 81% of total orders. Revenue increased by 11% on a constant currency basis to GBP 369 million, reflecting continued strength in core mining markets, together with contributions from Micromine, Fast2Mine and ESEL.

Across software solutions, growth in annual recurring revenue remained on track with our full year expectations. Operating profit increased by 17% to GBP 79 million on a constant currency basis, while operating margins improved by 120 basis points to 21.5%. This performance was supported by lower cost sourcing initiatives in China and Chile, together with the growing contribution from our higher-margin Software Solution businesses.

Turning to group operating margins, which were 18.8% for the first half, a decrease of 100 basis points year-on-year. The key drivers of the margin outturn in the first half were a headwind of 130 basis points from mix in Minerals stemming from new projects as we enter an upturn in the mining CapEx cycle and unanticipated aftermarket demand phasing between the first and second quarter. There was a tailwind of 100 basis points of further Performance Excellence savings, largely offsetting mix headwinds as we deliver on the final work streams of the program. And finally, a 70 basis point net headwind due to higher production costs and delays caused by production transfers across the Minerals business.

As we look ahead to the full year, with the visibility we have of our order book and momentum in execution, we expect both mix and operational headwinds to unwind as we remain on track to deliver on our full year guidance. As per our commitment to bring accounting and operating performance in line, we saw a reduction in adjusting items year-on-year, totaling just GBP 12 million in the first half compared to GBP 41 million in the prior year.

Total exceptional items for the half was a charge of GBP 1 million, which represents the step-up accounting gain on the acquisition of our ESEL JV, offset by GBP 3 million of acquisition and integration costs and a further GBP 12 million arising from the unwind of the fair value uplift on inventory for ESEL and Townley. Other adjusting items reflect normal amortization of acquisition-related intangibles, which have increased as expected.

Turning to cash, where adjusted operating cash flow decreased to GBP 156 million, reflecting increased working capital outflows due to the phasing of our original equipment order book, higher inventory levels to support production transfers and reduced collections from debtors in June, much of which was paid in the first 2 weeks of July. Working capital as a percentage of sales increased by 380 basis points to 26.7% at the half year.

However, we see this reverting back toward our 20% to 21% target as operations normalize. CapEx was flat year-on-year at 1x depreciation compared with 1.1x in the previous year, while free operating cash conversion decreased to 41%, partially driven by the timing of share purchase for LTIP awards and increased working capital. As Jon mentioned, these effects will unwind in the second half of the year.

Turning to cash flow. Phasing of working capital during the first half and higher interest following acquisitions in 2025 reduced free cash flow to GBP 1 million. Following the completion of our ESEL transaction, net debt-to-EBITDA increased to 2.2x on a lender covenant basis. However, given the second half bias of our cash generation, we expect this will reduce towards the high end of our stated range by year-end.

Turning to our outlook. We start the second half with a large order book, a strong demand backdrop and improving operational momentum, all underpinning our existing full year guidance reflected in current market expectations. We expect an acceleration of our project pipeline and positive mine site activity to support growth through the remainder of the year. We anticipate our high bid conversion rate and trial momentum to continue, growing our market share and together with contributions from acquisitions, we expect another strong year of growth.

As we deliver on our order book in the second half, we expect the costs associated with production transfer delays to end. Further, we expect demand within our Minerals aftermarket business to return to normal patterns. We are on track to deliver our GBP 90 million target in cumulative performance excellence savings and combined with improved operating momentum, expect to sustain margins above 20% for the full year. Finally, as operational momentum increases and working capital normalizes, we expect to deliver free operating cash conversion of between 90% and 100% at the full year. I'll now summarize the key messages from today's results.

Market conditions across our mining markets remain positive with strong activity levels across key commodities. Our markets, combined with the strength of our technology offering is reflected in our active and growing pipeline of opportunities. Our financial performance improved in the first half with a strong order book providing good visibility into the second half. We also continue to gain market share through our industry-leading total cost of ownership proposition and differentiated technology portfolio.

Operational momentum is likewise improving. While Minerals experienced some short-term delays associated with production transfers, we are back on track and expect the full benefits of our operational execution and Performance Excellence initiatives throughout the second half. Overall, as we enter the second half, the combination of our strong order book and improving operational momentum underpin our full year guidance for growth in constant currency revenue, operating profit and margins.

Thank you, and I will now hand back to Jon for closing remarks.

Thanks, Brian. Now with this being my last results presentation as CEO, I want to close by saying that it's been truly an honor to lead this remarkable company over the last decade and to thank you for both your support and constructive challenge over the years. When you start the journey as CEO, your hope is to leave the company in a stronger position than when you inherited it. And as I reflect, it is certainly a very different Weir to the one of 10 years ago.

We've gone through a strategic portfolio realignment to focus on mining and capitalize on the multi-decade opportunity it presents. The business has delivered growth through the cycle and through the Performance Excellence business transformation has achieved operational efficiencies and the platform for annual operating margins sustainably above 20%, all while reducing CO2 emissions and embedding a strong safety culture. We've also brought on board key acquisitions to grow our Weir family, most recently adding a world-class digital solutions platform with the 2025 acquisition of Micromine at its core. And looking forward, the long-term value creation opportunity for Weir is exciting and even more compelling.

The company is now a global leader in engineered hardware and software for the mining industry with a powerful culture and a strong team. Demand for critical metals continues to build and customers are increasingly recognizing the need for new, more efficient solutions to unlock future supply and for Weir, there's a clear pathway to sustained growth, delivering mining technology for a sustainable future. So I am satisfied that I'm leaving Weir in great shape with a clear strategy and strong prospects.

The company is set to become the preeminent provider of mining technology solutions across both hardware and software, poised for our next phase of accelerating growth and well positioned to deliver long-term superior performance for our customers and shareholders. In Andrew, you have an experienced and hugely talented leader, and I'm confident that he, together with Brian and the wider team, will continue to take Weir from strength to strength.

Thank you. And Brian and I will now be happy to take any questions.

[Operator Instructions] Our first question today comes from Chit Sinha from JPMorgan.

I have 2, please. So firstly, just on the margin bridge for H2. Thank you for providing color on the margin bridge in H1. Maybe if you could provide similar sort of detail for H2. I know previously, you've mentioned about 80 bps of investment costs for the full year and about a bit of a tailwind from M&A. So just wondering how we should expect this phasing into H2?

And then my second question is just on your pumps growth. I know you've mentioned in a bit of detail with regards to the trials that you've been winning. But perhaps you could shed a bit more light on the competitive landscape that you've seen, especially when some of your Western peers have been talking about market share gains. And then also if you could just touch on pricing in this context. I believe you've implemented about low single-digit price increases.

Yes. Thanks for the questions. Let me deal with the pumps and pricing point first, and then Brian can come back on the margin. So yes, I think you'll have seen from the presentation, we wanted to give a fair bit of color in terms of the success we've been having in the pump market, and you saw the stats that we've won 70% of OE tenders for new equipment and more than 90% of pump trials, which we approach on both an attack and a defense basis.

So we're always out in the market looking at mines where we do not have installed base and seeking to position our pumps on a trial basis to be able to take over those positions from our competitors. Also occasionally, that happens to us with competitors offering something different to what we're offering. So we attack and defend through those pump trials. As you see, the success, I think, really, really speaks for itself.

And when you step back with roughly 50% market share ourselves in pumps and winning 70% of OE pumps coming through and more than 90% of trials, we continue to inch up our market share. That's just the math of the numbers that I've given you there. So I appreciate that we have a fantastic franchise in pumps with all the strengths that you know and love. And it's through the cycle. I've seen that over all of the 16 years I've been at Weir. It's something that our competitors look to as an opportunity. But year after year, we continue to defend our position really strongly.

And I think the combination of the technology we have, which never stands still and the customer service and intimacy that sets Weir apart means that model is absolutely rock solid and resilient and will continue to deliver. And I also wanted to point out that those wins, those pump trials were also against all competitors. So be they the European peers or the Chinese as well, that is our total global success rate. So again, very, very confident in the position that we have and the ongoing sustainable resilience that it will demonstrate.

On pricing, I think we're exactly where we thought we would be halfway through the year. We said it's a low single-digit pricing environment at the moment. There's quite a bit of cost consciousness out there among our mining customers at the moment. And clearly, from an OE point of view, it can be a bit more competitive at the earlier point of the CapEx cycle, and that tends to moderate over time. But for now, the realization that we're getting in pricing is absolutely in line with that low single-digit expectation that we had at the beginning of the year. So with that, Brian, margins?

Yes. Thanks, Chit, for the question. If you look at margins, as I start with H1, we had the tailwind with the Performance Excellence that contributed about 100 basis points increase to margins. But we had 2 things offsetting that in the first half. First, we had an unexpected mix within aftermarket. With a wide variety of products we've had, we saw a different level of mix that we've seen previously. That contributed a portion of the 130 basis points decrease that is in the bridge in the slide pack.

And the other part of that was, as Jon said, as we entered the cycle in the early phase of that cycle, pricing sometimes is a bit more intense. So we've seen a little bit on the OE side there. The good news is that aftermarket mix that we saw, if you look at the order book, we see that reversing in the second half. So that should be coming back. The Business Excellence or Performance Excellence will be increasing to 120 basis points in the second half.

And then the last bit that was a headwind in the first half was the delays in some of the production transfers and some of the work we needed to do led to some higher costs in the first half. And that had a 70 basis point impact in 1H. Once again, that will reverse in the second half. So we see us being sustainably above the 20% margins, as we've discussed, and we're quite comfortable with the operating profit that's currently in the published guidance, hence, why we said that guidance is underpinned.

To the last part of your question regarding the impacts of the S4 program, the S4 program is kicking off, but it's more second half weighted. And we'll probably see that, that impact will be slightly less than originally expected in the first half. I think we had 70 to 80 basis points in there. It's probably half of that for the full year 2026. So hopefully, that answers your questions on those, and thanks for the question.

Jon, it's been a fantastic tenure.

Our next question comes from Jonathan Hurn from Barclays.

I have 3 questions, if I may. Firstly, just focusing on obviously that strong OE growth that you saw in the second quarter. Obviously, from the commentary, you expect that to continue through the remainder of this year, and I suspect into 2027 as well. So can you just talk about how we think about margins and mix going forward? I mean I know historically, you've said Weir can do between a 20% to 22% margin. But do we -- when we kind of look at the group, do we think at least I suppose, the near to medium term, it's more towards that sort of 20% as you get an adverse mix. That was the first question.

The second question was actually just on your sort of vertical stirred mills. Obviously, good order growth in the first half. Can you talk us through maybe in a little bit more detail about that AM opportunity? Is this sort of the annual spares to OE in that sort of 30% level? Or is it essentially a higher aftermarket opportunity, those vertical stirred mills?

And then the third question, maybe for Brian, was just in terms of that sort of working capital, obviously, a big outflow. We did see some customer payments sort of be extended essentially. Do you think there's scope for that to continue in the second half? Or was those sort of extensions of payments from your customers just one-off?

Thanks, Jonathan. Let me take the first 2. And then I just want to make the point I've been making for a little while on margins and bring you back to the Capital Markets event last December. The whole setup of where we wanted to go with margins was to achieve the floor of 20% operating margins because we think that is the gold standard for industrial companies who are seeking to earn a badge of a high-quality compounder. And so the whole setup has been say we want to get there as rapidly as we can and then over time, sustain ourselves as a 20%-plus operating margins company.

Now some people are saying, well, just can you keep expanding those margins up and up and up? Well, I don't think that's right for the business because of 2 things. First of all, the next phase for Weir, which Andrew is going to lead is all about growth. It's all about taking advantage of the growth that is going to be available in this market through our technology and innovation, through the CapEx cycle that's coming, through our resilient aftermarket model. So this opportunity ahead over the next few years is really about growth and accelerating that growth and delivering on that. And that will deliver -- if we deliver on that growth and we execute well, that will deliver outstanding returns, and we will see our return on capital employed significantly increasing. So that's the backdrop. We don't want to be doing anything short term that means we're not investing in that growth.

And secondly, our customers do look at our margins, and we just need to be mindful of how they're feeling if our margins are marching ever upwards. So it's with that context that 20% is the floor. That's where we very much intend to stay. That's the whole setup of the company. And from here, it's really about accelerating growth and returns. In some years, may it be higher with a positive mix or whatever, of course, but we don't want to be on a sort of conveyor belt where there's expectations it's going to go ever up and up. That's just not realistic. It's not the right thing for the business.

And then on the vertical stirred mills opportunity, yes, obviously, we're very mindful that across all of our portfolio, that kind of classic ratio that you've seen with Weir of $0.30 of aftermarket every year, for as long as that equipment remains in the mine for $1 of OE and the vertical stirred mill that we have developed is bang in line with that average for the division. Not quite as high as the very best mill circuit pumps, but back in line with our overall average for the division. So the aftermarket is expected to be $0.30 in the dollar after we sold the equipment once it's commissioned on an annuity basis. Brian, on the payments.

Yes. Thanks, Jonathan. In terms of -- it's probably a wider question on the working capital. Working cash conversion was 41%. I think the first thing to note is from a seasonality standpoint, we are generally somewhere between 55% and 65% in terms of cash conversion. And there's really 3 things to talk about on why it's lower this half year. The first is we purchased the LTIP shares in the first half of this year as opposed to the second half like we did in 2025. That had about a 5% impact. That will not repeat in the second half of the year.

The second one is around inventory. You look at the strong order book that we just printed here in the second quarter for the first half and you look at the book-to-bill of 1.12, we needed to build up this inventory to deliver that in the second half. And as you see, our revenue is 45-55, so in terms of the split, 1H to 2H. And so we have that higher inventory level that will burn down over the second half. So you'll see that convert into cash, which leads to the last point is around debtors, and you rightly called out that debtors increased.

And what we saw at the end of June is our current debtors that are normally 0 to 30 days and paid at the end of June slipped. We saw about 30 to 40 customers slip into the second half. All that money came in with the first 10 days of July, but it didn't come in at the month end. So we will be looking at that closely over the coming months to ensure we don't see a repeat of that. But that had about an 8% impact on the cash conversion. So we remain very comfortable to be within the 90% to 100% range that we guide towards. But those were the impacts for 1H and why we're happy that they will reverse in the second half.

Great. Very clear. And Jon, I'd just like to say thank you for all your insights on Weir Group over the last 16 years. It's been great to see the company transform as a pure-play mining equipment leader under your tenure. And obviously, you've done some big things. You've exited flow control and obviously, the volatile oil and gas business. So best of luck for the future and the next chapter ahead.

Thanks, Jonathan. And for your support as well. I know you were one of the first analysts I met 16 years ago when I joined the company. So I've appreciated working with you over the years.

Our next question comes from Tore Fangmann from Bank of America.

First of all, as well, all the best for you, Jon. And secondly, looking very much forward to meeting you as well, Andrew. Just 2 from my side. First would be a clarification on the market share in pumps. So if I'm seeing it correctly, FLS is winning market share, METS is winning market share, you are winning market share. So could you please give us a little bit of insight on who's actually losing market share out there? Or are we maybe focusing on the wrong type of pumps? I mean there's many different pumps in the flow sheet. And are you maybe focusing on like a different value portion of the overall portfolio? Any insights would be super helpful.

Well, yes, I mean, thanks for the question. And I think what I would say is that as far as I can see, we're the only people who are actually putting some numbers out there. So I think our statements about market share are backed by those percentages that I talked about earlier in terms of share gains on pump trials and share gains on OE. And beyond our European peer group, there are Chinese and local replicators here and there. So it may be that our peers are taking market share from some of those guys, but it's certainly not coming from us. We're definitely not in the business of donating market share to anybody, quite the reverse.

Now do we focus -- you know what our business model is, it's razor/razor blade. In the answer to my last question, Jonathan, I said we like that $0.30 on the dollar. So we do -- we're very disciplined in maintaining that in the bids that we go for. So if, for example, there are very light-duty slurry or water pumps that don't have the aftermarket, we are not going to go after those and sort of lowball pricing to win those because there's no aftermarket capability. And so that may be a factor in there, but we're very focused on big mill circuit, heavy-duty, high abrasion in the best parts of the mine that continue to deliver that razor/razor blade model, which is why our revenues are 80% generated by the aftermarket. That's what we do. And that's where we focus and we continue to win there. So I hope that gives you a bit of the color that you were looking for there.

That is super helpful. And then just lastly, a bit more macro. If we think about the upcoming FIDs, especially in the copper space across regions, but a lot of this in the Americas as well, do you have any view on the time line of this? Is it moving closer? Are the permitting now speeding up a little bit? Anything you could give us on detail on like large equipment orders to come would be super helpful.

Yes. So it's a good question. And as I highlighted in the presentation, we are definitely seeing good progress in the Americas. Actually, in North America with now all of the political weight of the current administration and many of the departments within the current administration having their own critical minerals policy, there is a lot of focus on that in the U.S. and more broadly in North America.

And for some of the smaller projects, we've already seen some of the initial pump packages and orders coming through in the first half of this year, which one of the things that supported the good OE orders that we've seen and particularly as they strengthened in the second quarter, a lot of that came through in North America for some of the smaller projects now. There are potentially larger ones to come. And that is very much the case in Latin America at the moment.

Again, with the change in government there in November last year, we've got a very, very different political perspective on the copper industry in Chile and now also with the recent elections in Peru, that is also pretty helpful as well. And also Argentina, obviously, we've had that sort of more pro-growth government over the last couple of years and the projects in Argentina have been progressing as well. So there's a long list of projects.

As ever with these projects, it's difficult to predict when exactly that they will come through, but the activity levels are much higher. We know through our conversations with the EPCMs, EPCs, they're all -- they're very, very busy on mining projects at the moment. We're working closely with them on flow sheets across the piece. So difficult to predict exactly when, but it's certainly a more positive environment and more encouraging than we've seen in the last little while. So I think it's -- it will be exciting to see how that plays out over the next 12, 24 months, but it does feel like we should see some of those larger projects start to come through.

And then sorry, one more quick one for Brian, maybe. In the recent print, you have highlighted the target of 50 basis points margin expansion. And on this print, you left it out and basically flag you're targeting the over 20% margin. Is this deliberate? Or any take on this?

Thanks for the question, Tore. As we've always said, we want to have industry-leading margins and be sustainably above 20%, and that's what we're committing to. And looking at the operating profit that's in the published guidance, we're comfortable with that. With all the moving parts that are currently happening and potentially the start of the CapEx cycle, it's not that we're moving away from anything, but we're trying to get everything to the last 10 basis points or 20 basis points is nearly impossible. But -- so I think what you should take away is we're very happy with what is published guidance out there. We're sustainably above 20%, and we're trying to drive and will drive industry-leading margins.

Our next question comes from John Kim from Deutsche Bank.

Wondering if I could ask 2 questions, please. First, if we think about the change in path to market in ESCO, and I'm speaking to the Chilean distribution relationship. Any sense of magnitude of phasing on how this might change numbers there? And then secondly, if we think longer term, let's call it, 3- to 5-year view, which end markets or regions do you think on balance are the most interesting from incremental opportunities? I imagine given kind of a 5-year time frame, you have some sight line already on RFPs.

Yes, great question. So I think we're -- it's been a long journey to finally get that direct relationship going in Chile and buy out the JV, but we were delighted to get that over the line this year. And we're super excited what it does for ESCO because I think when we look at our market share in Chile today compared with, say, Peru, just up the road or where ESCO is in North America, our market share in Chile is probably 1/3 of what it is in those markets where we have 50%-plus market shares. So the opportunity is very, very significant in terms of going after that and bringing new customers over to ESCO in that market. It's not going to happen overnight.

The focus so far this year has been very much on transitioning the existing customer relationships from our distributor back into Weir, setting up the direct footprint, leveraging the Minerals footprint big time in Chile, I might add, so that we can get boots on the ground in those mines with ESCO salespeople and start to get that going. Very happy to say that all those customers transitions are complete. No balls dropped in terms of making sure that those customers were properly served.

And now the focus is very much on how we start to go after that market share and do what we've very successfully done with ESCO all around the world, again, coming back to having the best wear life, best technology, best customer intimacy. That's how we win in the market. And we're very, very focused on seeing that through in Chile. And yes, over our sort of 3- to 5-year strategic horizon planning, we expect to see those market shares increase quite significantly.

And it's also not unhelpful from a margin point of view as well because obviously, we're cutting out the third party who take a portion of the margins. And also, we get that -- we get direct control of the foundry in Chile, which gives us more low-cost capacity for production of GET. It's the second lowest cost per tonne in the ESCO network of foundries after China. So for us, it's kind of a win-win-win opportunity for all those things. So yes, very, very excited about what that can deliver over the next few years, and the team is really fired up to get after it.

Could we then pivot to my second question about which regions you think are the most interesting from a 5-year perspective?

Yes. No, I mean, I think -- sorry, I forgot that. Apologies. No, I mean, I think the Americas are -- they are becoming our strongest growth markets currently. And when you look at the project pipeline, I think that's probably where across the business, we are going to see the strongest growth over the sort of medium term. And when you look at -- and it sort of pivoted, I think, in the last 2 or 3 years. So if you go back 2 years, then there was all the lithium mines being built in Australia. Australia was very, very busy, and that sort of plateaued a little bit for now. So I think I would point to the Americas.

But just also with ESCO in mind specifically, I think we've still got quite a lot of countries around the world where in Central Asia, in Africa, in the Asia Pac region, where we've still got probably lower market shares than we would like, and there is opportunity. So on a regional basis, ESCO still has more to do to get the balance of revenues across the world relative to the Americas. So I think, again, it's got a nice position in that there's good growth coming in the Americas because of the project pipeline and the opportunity in Chile for ESCO.

There's also more that we can do around the world. And over the last year or so, we've developed a strategic selling program, where do we have lower market shares or no share that we think we can go get and systematically, the sales team around the world is going after those. So again, for ESCO, it's very much about pivoting to growth with those levers to pull on. I hope that helps.

Our next question comes from Edward Hussey from UBS.

Maybe just one for me given the time. So you outlined in the release strength in oil sands, and I guess that's been a bit of a headwind alongside coal for a couple of years now. Do you mind just sort of commenting on the outlook for these 2 commodities given the high energy prices? Are we sort of expecting a sustainable uptick from here?

Yes. I think as we look at oil sands, I wouldn't say that we've had headwinds in the oil sands. It can be sort of slightly more cyclical, obviously, than some of the hard rock mining customers that we serve. And with the lower oil price, it's been flat rather than facing headwinds, I would say. But clearly, with current oil prices then and what the U.S. is trying to do in terms of reindustrializing in the U.K., I think it's very positive for that market at the moment. And so we're seeing strong aftermarket orders but also some projects, some efficiency-related projects and some brownfield expansion investments going on at the moment, which are encouraging. So we expect to see that to continue as we move forward.

Is there going to be massive new CapEx up in the Canadian oil sands? Probably not, but you've got all of that invested base there, and I think it's going to be a very solid part of our business for a long time to come. And the aftermarket, it's very -- as oil sands is probably one of the most abrasive mining operations that we serve. So it's a very attractive aftermarket. So it's a good place to be. And I think as I say, it will be pretty solid through the cycle as we move forward.

Coal is now -- the outlook is probably looking better in certain markets given some of the geopolitical activity that we've talked about, albeit it is really, really small part of our portfolio as we sit here today, kind of down into the sort of single digits of revenue now. So -- and it's not an area that we'll continue to serve those customers where they need us and continue to drive technology to make it as sustainable as possible, but it's certainly not something that we see as a big growth driver moving forward.

Our final question comes from Andrew Douglas from Jefferies.

I like to have the final word. Just 2 small ones for me. In terms of M&A going forward, you've talked about a pipeline. Can we talk about kind of what that pipeline looks like in terms of where you want to go with M&A? Clearly, we've had a number of software acquisitions over the years. It does seem like the customer base occasionally wants a full flow sheet. So whether would there be more focus on product acquisitions going forward?

And secondly, just on the commentary regarding the strength in Americas. I appreciate there's North and South America. But maybe North America is not your strongest point. Townley helps you there. Do you think you need more M&A in North America to benefit from all of the opportunities that are coming there?

Yes. Thanks, Andy. And I'm delighted you had the final word. You'll forget about that. You're the second analyst who's asked a question, who I also from 16 years ago, so good to work with you. Yes. So on M&A, I think, look, we've been very focused in 2026 and continue to be focused on delevering to create more balance sheet headroom to go and invest in further bolt-ons in the future. But as we do that this year, then the focus has been very much on refilling the pipeline of opportunities so that as we get into next year and beyond with that balance sheet capacity, we can hopefully pull the trigger on some other acquisitions.

And actually, the things that we're focusing on hasn't really changed very much. I mean, obviously, we've built the digital software platform. So further technology bolt-ons is certainly on the agenda. But equally, product infills and geographic infills are also things that we are also keen on doing where it makes sense and we can see through disciplined M&A that we can create returns and add value. So the 3 buckets really haven't changed.

And as ever with acquisitions, it tends to be opportunistic. You need willing buyer, willing seller. So you can never say we're going to do focus on this bucket this year or so on. It depends on what actually comes to market and we're able to acquire. So we sort of keep our options open to a degree. But I think the pipeline is looking really good actually across all of those buckets as we start to build it back up. And so Andrew and Brian are very focused on that, and we'll take the lead, obviously.

Specifically in the Americas, I think Townley gave us what we wanted in terms of a North American foundry, which is something you may remember, Andy, given your tenure that we've talked about many, many times over the years. So having that capacity and particularly with the current administration's kind of reshoring of manufacturing and industrialization is perfect timing. It's a great asset to have now within our manufacturing portfolio.

It got us into the phosphate market in Florida, which is also a good position to be over the long term. So might there be smaller bolt-ons in North America in the future, for sure. But for now, I think we've got really what we need. So it's not something I would specifically say you can expect to see more of in the next year or 2. You never know. Again, it depends on what comes up. But -- and the focus is clearly globally on what we can bring into the portfolio that's going to help deliver compounding returns wherever that may be in the world.

Jon, thank you for your help and support over the last 15, 16 years and I wish you well.

Thank you very much.

That concludes the Q&A portion of today's call. I'll now hand back over to Jon for closing comments.

Yes. Thanks very much, and thanks, everybody, for attending the call and your questions. And as usual, we'll be available over the coming days for any follow-ups. And I just want to add that I appreciate a few things to digest after the softer first quarter, but I'm delighted with the progress that we've made through the second quarter. And I think reflecting what we have shown over the years is that we have made excellent progress year-on-year-on-year through our transformation. And I see this year as being absolutely no different to that.

You may get the occasional lumpy quarter as we saw in Q1, but the model is incredibly strong and resilient, and it will sail through that. The company is in great shape, got a fantastic business model and a powerful engine for accelerating growth and returns ahead. And then Andrew, you've got an incoming leader. I've worked with Andrew for 16 years. He's the right man to take it forward and to go on and take Weir to the next level. And I'm really looking forward as a major shareholder for many years to come to cheering on from the sidelines. So I wish Andrew and Brian and the team every success in the future, and I'm sure they will deliver it. Thank you very much.

Hello, everyone, and thank you for joining us today, the Weir Group PLC Q1 IMS. My name is Sammy, and I'll be coordinating your call today. [Operator Instructions] I'll now hand over to your host, Jon Stanton, Chief Executive Officer, to begin. Please go ahead, Jon.

Thanks, Sammy, and good morning, everyone, and thank you for joining us today for our first quarter 2026 trading update. As usual, I'm joined by our CFO, Brian Puffer, and after my remarks, we'll be pleased to take your questions.

First, I'll talk about the Q1 statement and then come back to today's other news at the end. So starting with the external environment, demand fundamentals in mining remain positive, underpinned by structural growth in critical metals such as copper, iron ore and gold. Our customers continue to prioritize productivity, debottlenecking, and expansion projects at existing sites alongside investment in technologies that improve sustainability and reduce total cost of ownership.

Demand for large equipment projects is picking up pace. In the quarter, we picked a GBP 20 million order for GEHO pumps in India, further evidence of our market-leading slurry transportation solutions and the pipeline of larger expansion opportunities is really encouraging. Adding to our larger wins, we booked a number of smaller strategic orders in the quarter. We continue to see market share gains in our core WARMAN pump and ESCO GET brands and the pipeline of opportunities for our newer technologies is very encouraging.

Excitingly, in Software Solutions, Micromine is starting to see incremental growth generated by leads from the broader Weir network with a license sale of a major Tier 1 customer. And we saw the first international orders for Fast2Mine resulting from our initiatives to grow outside of Brazil. Our business is executing well with the integration and performance of recent acquisitions all well on track. And against the backdrop of growing geopolitical tensions, particularly in the Middle East, our strong operational platform is delivering for our customers with limited impact to our global supply chains.

Turning to results for the group, where we have good visibility on the order book and are on track to meet our full year guidance. In the quarter, overall orders increased by 4% year-on-year on a constant currency basis. This reflects good momentum in underlying trading and contributions from recent acquisitions, offset by phasing of orders compared to last year and some temporary mine disruptions, all of which we expect to reverse over the balance of the year.

Group original equipment orders grew by 1% year-on-year, and this included very strong demand for ESCO's highly engineered mining attachments and several nice medium-sized order wins in minerals, but no larger orders over GBP 25 million this quarter. Group aftermarket orders grew by 4% year-on-year, supported by positive activity levels in copper, gold and iron ore within minerals, strong levels of demand in ESCO across both mining and infrastructure GET, and good growth in Micromine and Fast2Mine.

Overall, our book-to-bill ratio increased to 1.14 in the quarter, following normal seasonality. Turning to Minerals, where original equipment orders declined by 3% year-on-year on a constant currency basis. Underlying demand for debottlenecking and brownfield expansion projects remains positive, and the larger expansion project pipeline is developing strongly, especially for copper in South America.

We therefore expect to see strong OE growth for the full year, with Q1 trends really just driven by phasing and timing of orders. We continue to gain market share through our technology leadership. During the quarter, we completed four mill pump circuit trials, three of which were successfully converted to WARMAN pumps. And this reinforces our strong competitive position and the value our customers place on performance, reliability and total cost of ownership. In aftermarket, Minerals orders increased by 1% year-on-year.

Growth was supported by solid ore production levels in copper and gold, as well as the ongoing integration of Townley, with the sales team now fully aligned to the broader Minerals organization. This momentum was partially offset by a number of temporary mine site disruptions in APAC and Africa, as well as the booking of several larger HPGR spare orders for newly installed machines in Q1 2025, which typically are more lumpy as wear rates diverge. Overall, we remain encouraged by the underlying trends in Minerals, particularly the long-term opportunity driven by our growing installed base and continued focus on productivity enhancing technologies.

Turning to ESCO, performance in the quarter was strong. Original equipment orders increased by 49% year-on-year, reflecting exceptional demand for mining buckets across strategic mining regions globally, including North America, South America and Africa. In Australia, we received our first orders for the innovative Production Master, which we presented at the Capital Markets event last December.

In aftermarket, orders increased by 11% year-on-year. This was driven by continued momentum in mining and infrastructure GET up 7% and good growth in our newly acquired software businesses. This was partially offset by the phasing of dredge orders, which were exceptionally high in Q1 last year and have been disproportionately impacted by events in the Middle East. We continue to gain market share, achieving 19 net major digger conversions in the quarter as we execute on our strategy for growth in lower share geographic markets.

Turning to strategic progress, where in the quarter, we announced the completion of our acquisition of the remaining share in ESCO's Chilean joint venture, ESEL, strengthening ESCO's ability to serve customers across South America and bringing more foundry capacity in-house. Integration of ESEL is progressing well, with key customers transitioned and orders up year-on-year as we deliver on the go-direct strategy.

And we remain very excited about the potential to significantly grow market share in Chile. We're also making good progress integrating our other 2025 acquisitions, and all businesses are performing in line with our expectations or better.

2026 is a year in which we will deliver the full run rate savings for Performance Excellence. And in the first quarter, we began to realize savings from capacity optimization projects completed in 2025, bringing cumulative savings to GBP 66 million. Further savings from LEAN and WBS activities put us firmly on track to deliver our upgraded target of GBP 90 million of cumulative savings in 2026.

Turning to net debt, where our refinancing and acquisition activities in 2025 leave us with a very attractive debt profile with long-dated maturities. We're on track to return toward our normal operating range of 0.5x to 1.5x net debt to EBITDA by the end of 2026, in line with our capital allocation policy.

For the full year, we expect net interest expense of GBP 90 million, which through 2028 we expect to reduce towards GBP 70 million given our strong cash generative business model. Turning to outlook, where we see customers increasingly investing in expansion and debottlenecking projects as supply deficits in critical metals emerge. Overall market activity levels remain very positive, and activity around larger projects is also picking up pace. As I mentioned earlier, we are encouraged by the visibility in the order book and the pipeline of opportunities. Over the year, we expect to see good growth in organic orders and a strong contribution from last year's acquisitions.

For the full year, we reiterate our guidance for growth in constant currency revenue and operating profit, operating margin expansion of 50 basis points, and delivery of free operating cash conversion of between 90% and 100%. As in 2025, we expect a weighting in revenue and profit to the second half. We expect cash conversion to follow normal seasonal patterns with a steady build in inventory through the first half, followed by collections towards the end of the year.

We remain focused on disciplined execution despite several challenges facing the mining industry, not least rising uncertainty as to potential impacts from the conflict in the Middle East, which we continue to watch closely. So summarizing the key takeaways from today, we made good strategic progress in the first quarter, closing ESEL and integrating Micromine, Fast2Mine and Townley at pace. We expect good growth in orders over the full year, assuming broader contagion from the Middle East is limited. And given all of the above, we remain on track to deliver our full year 2026 guidance for growth in revenue, profit and margin.

Now, before we move on to questions, I'd just like to say a few words on the announcement today that after 16 years at Weir and nearly a decade as CEO, I'll be stepping down on the 1st of August, and Andrew Neilson, President of Minerals, will succeed me as the new CEO. It has been an absolute honor to lead this remarkable company.

A decade ago, Weir was an industrial pumps conglomerate with businesses of different qualities and characteristics prone to industry cycles and limited in its capacity to weather external events. With thoughtful portfolio transformation, focus on building a resilient balance sheet, delivering best-in-class margins, and investing in world-class Software Solutions, we're clearly positioned to benefit from the transformational technological change as our customers scale up and clean up their operations. With our strong platform across engineered hardware and Software Solutions in place, it's time for both Weir and me to begin our next chapters.

Andrew and I both joined Weir in 2010, about a month or so apart. So he's been on the journey all the way, and I am delighted that he is to be my successor. Having led both ESCO and Minerals, Andrew is an experienced and hugely talented leader, and I'm confident that he will continue to take Weir from strength to strength. He and I will work closely together over the coming months to ensure a smooth transition, and I'll see you at the end of July when I will present our half year results.

That concludes my remarks, and Brian and I will be happy to take your questions you may have. So back to you, operator.

Thank you very much. [Operator Instructions] Our first question comes from Jonathan Hurn from Barclays.

Just two questions from me, please. The first question was just on organic orders, and obviously, they were down in the first quarter. Look, you've given reasons for that, and obviously, you said that they're going to improve. I'm just wondering if you could talk a little bit about the shape of the recovery of those orders as we progress through FY '26, particularly aftermarket Minerals. And also just in terms of what level of organic order growth we can expect for OE and AM in 2026?

And then the second question was just on revenue. So if we back out sort of Q1 revenue, it looked to be broadly flat year-on-year. But obviously, there's some M&A contribution within that, so organically, it was down. Can you just talk us through why organically it was down? Was that just down to obviously maybe the sort of the weak or weaker Minerals AM orders? And how do we think about that going forward? And then just in terms of the H1, H2 revenue split as well, that'd be helpful. They're my two questions.

Yeah. Thanks, Jonathan. Appreciate the question. So yeah, on the organic orders, look, a lot of moving parts obviously in Q1, which we have explained. But as we sit here today, we have a strong order book. We have really good visibility of the pipeline. We have really good visibility of the customers' production plans. And yes, there were a few moving parts in Q1, but we definitely see those being temporary. And occasionally, you get a quarter like this where you do see some disruptions and it knocks you a little bit off. But as we see every year, the aftermarket orders will always revert to mean.

And that means for both Minerals and ESCO, we will see that mid- to high single-digit aftermarket growth over the full year, and we have strong visibility into that. We're expecting a good recovery in the second quarter. We have visibility on a couple of large-ish aftermarket orders, which are coming through on top of the normal sort of run rates. So we feel really good that we're going to see the bounce back from where we are at Q1.

And if you look at ESCO, in particular, just to give you an example, if you look at mining and infrastructure GET, the core aftermarket in ESCO, that's up 7% year-on-year. So that's sort of the underlying -- and ESCO didn't see some of the mine disruptions that Minerals saw because they weren't in those regions -- they didn't have the presence in those regions that Minerals saw those disruptions. So that's where the -- if you look at that as a key indicator of where the underlying activity levels there are, that's what we should be achieving through the aftermarket through the year for both ESCO and for Minerals. So that's where we fundamentally expect it to revert to that mid- to high single-digit growth over the course of the full year.

And the comps are cleaner as we go through the balance of the year relative to some of the things that we saw in the first quarter. So that's aftermarket -- from an OE point of view, again, we expect to see growth over the balance of the year. We've always said OE is lumpy. You can never look at one quarter and say that's a trend. We didn't have any larger orders, particularly in the first quarter.

We had the GBP 20 million order we talked about in the speech, but we had a similar size order last year. So it's really just phasing of when orders get placed that we're seeing there. And with the strong pipeline that we have and good visibility on that. And again, we booked a couple of nice orders already in April in OE. So really good confidence that we're going to see good growth coming through on the OE.

On the revenue side, the way you backfilled that, Jonathan, yes, it is correct. But again, that's really just phasing of deliveries in the order book. If you look -- we had a massive December a lot of stuff got shipped in December. So that just created a little air pocket in terms of order book going out in Q1. But as I say, with the book-to-bill we've had in the first quarter, the order book is higher now than it was at the end of December. And we've got good visibility and plans on how that's gonna play out over the balance of the year, which is why when you boil it all down, we remain very confident on reiterating guidance, because we can see where it's coming from.

Our next question comes from Andrew Douglas from Jefferies.

Just a couple of questions from me, please. And good luck, Jon, on your next endeavors. Can you just talk about that in a little bit of detail? Clearly, an interesting time to be doing it. You've just spent a lot of money on software, big strategic change at Weir. Just kind of what's behind the timing of that seems a bit odd to me, to be honest. I mean I know you do out to the U.S., but I thought you might be around for a little bit longer.

And secondly, on the supply chains, raw material inflation, cost inflation, energy availability, I guess, particularly in the foundries, how are you managing that? Any particular challenges that we should be cognizant of going into second and maybe third quarters?

Okay. Thanks, Andy. Yes, so the announcement today on CEO succession is the result of long-term board succession planning. I've been on the board for 16 years, 10 years as CEO. I feel I can move on having left a fantastic legacy with the company in great shape. Specifically, the acquisitions from last year and software deals, they're integrated, they're performing exactly as we expected. So a lot of the heavy lift is done there. We expect them to deliver exactly what we wanted in terms of revenue this year, and Andrew is clearly fully behind the strategy in terms of delivering that.

You know Andrew, he's been around for a long time, done multiple roles and been building up to this point over his sort of 16 years as Weir having run both ESCO, and Minerals. And he's ready to sort of pick up from me at this point in time. So it ended up being a very natural point from an overall succession planning point of view to make the call. And the fact that I moved to the U.S. last year has absolutely nothing to do with it whatsoever. So rest assured, I'm going to hang on for quite a while just to make sure that everything goes smoothly and it's a seamless transition as you would expect. So I'm not looking for anything else just yet.

On the supply chain, look, we're watching it really closely, but nothing really to see yet. Obviously, our customers are feeling the pinch a little bit on oil prices. But given where commodity prices are, they're still -- we're not seeing anything approaching any sort of challenges in terms of slowdown. There are a couple of other derivatives effects potentially in terms of sulfur and sulfuric acid and urea or all of which are feedstocks into various minerals. So again, watching that, but no impact just yet. So obviously, the sooner the situation in the Middle East gets resolved, the better. We're watching it closely, but no impact as we sit here today.

And Jon, just a quick follow-up. What is your main energy source within your internal foundries? Is that LNG or oil?

Well, no, I mean, it's electricity, obviously. The foundry is powered by electricity and natural gas. You know, distribution to local markets, Andy. So a lot of our electricity there is actually renewable if you think about where we operate in Chile and places like that. So we're in okay shape in terms of those sort of costs.

Speaker 0

Our next question comes from Christian Hinderaker from Goldman Sachs.

Firstly, congratulations, Jon, on what's been a big portfolio and margin journey for the business and also to Andrew on his new role. I wanna start, if I can, on orders in Minerals OE. You had two press releases in the quarter, one for HPGRs in the DRC and another for modular crushing in Namibia. I appreciate you might not be able to disclose absolute figures, but how should we frame the scale of those? You've called out that GBP 20 million order in India for GEHO pumps. And I know you've got the GBP 25 million number for large orders, but how do we think about those in sort of magnitude?

Yes. I mean the two you mentioned weren't RNS, or they were just like trade press releases because they're relatively small orders in the scheme of things, so a few million each. So they would be in the normal kind of small brownfield expansion and deep bottlenecking kind of category. The GEHO order for GBP 20 million we called out in the speech 'cause that was a really important win. It's a big iron ore pipeline win in India. [Audio Gap] Dramatically's an important place to be, but there was a similar size order last year as well for that product. So net-net, that didn't impact the comps. So yes, there's really -- as I said in the answer to Jonathan's question, you can't read anything into one quarter of OE.

Over the course of the year, the pipeline for us is really encouraging. We expect it to convert into growth in OE orders over the course of the year. The big question remains, do we see some of the bigger projects coming through? But there's a lot of activity to advance those, particularly in South America. We were in Chile a couple of weeks ago for CESCO Week, a sort of global copper conference and very, very bullish mood down there around what's gonna happen in Chile, with some of the projects there expected to be the first cabs off the rank, in terms of larger expansion projects, if I could put it that way.

Thanks, Jon. And you touched on iron ore. I know you've called out copper gold in the statement. But just broadly speaking, what are you seeing on iron ore? Maybe ex the GEHO order?

Yes. No, I think -- look, I mean, our iron ore exposure is principally in the very high-grade locations around the world. The iron ore price is pretty robust still. There's a lot of activity in India because India is trying to domesticate or domesticize steel -- iron ore production to feed its steel industry rather than bring it in. But the grades in India are quite cheap, so there's a lot of beneficiation-type projects going on in India at the moment. So we expect that to be a good market for now.

But other than that, the market is pretty robust, in terms of the underlying aftermarket, except for those -- a couple of those weather sort of related disruptions that we talked about in APAC, where iron ore mines that were hit by cyclones or whatever and knocked out for a few weeks. And obviously, that hits our aftermarket when something like that happens. But on an underlying basis, very robust.

Fair enough. And maybe a quick final one, if I may. Can you just remind us on oil sands and dredging, the scale of those? I know you've got the comp for dredging, but just how we think about it on a sort of yearly basis.

Yeah. I mean if you think about dredge, which is the sort of -- these are the ESCO cutter heads and tips that go on dredge boats, which where most of the activity is in the Middle East, unfortunately. To scale it, last -- Q1 last year, we had about $10 million of orders, which was exceptionally high, as I said in the speech, for dredge points, and that was zero this year. So a big reason of the -- for the moving parts on the ESCO organic.

But over the balance of the year, dredge overall last year was lower than the previous year. We had that big order in Q1 and then very little over the balance of the year. So there's nothing kind of dredge-related in the comps as we go through the next quarters, which will pull the ESCO numbers back, which means that the underlying growth in the mining GET will shine through over the balance of the year, as I said earlier.

And then on the oil sands, look pretty active up there, obviously, with the oil price. So the outlook there is good for the balance of the year. And so we feel good about that.

Our next question comes from Alex O'Hanlon from Panmure Liberum.

Well done. Just one quick question for me. I mean, it sounds like there's been further good progress in Software Solutions in the quarter. Can you just give us those normal Micromine KPIs, which you've listed out at the results and at the CMD, just to give us a flavor for how that business is tracking?

Yes. Yeah. No, look, I mean, over the balance of the year, we expect Micromine to hit the annual recurring revenue growth target that we set at the time of the acquisition. So that's our plan, and it's on track to deliver that. So we're not going to give that number every quarter, but we'll give it at the 6-month and 12-month points. But we're absolutely on track to deliver the acquisition plan in terms of that growth level. It's going great. We had that big win that I mentioned in the speech with a Tier 1 customer, which Micromine has been trying to get into for years and Minerals and ESCO were able to open the door in a way which allowed them to secure the order.

So that's how those -- that revenue growth acceleration initiative is going to work. It's a great example. And Fast2Mine, it's much smaller, but it's going like a train. I mean, we're really, really excited about what that can do and how it fits into the broader product portfolio. We're in lots of -- until now, it has been just Brazil domestic. We now got the team in lots of countries around the world pushing it out and getting a lot of traction, which is great to see.

Our next question comes from John Kim from Deutsche Bank.

One thing, wanted to see if you could comment on kind of competitive dynamics right now. I think the team previously mentioned that there might be a bit more competition on pumps and pricing. And if we kind of extend that question, if we think about knock-on effects from the conflicts and higher oil prices, how should we think about price-cost dynamics, particularly in the second half for the business?

Yeah. Look, I think we're very comfortable with our competitive position from pumps point of view, as I said in the speech. We can -- our acid test is always those mill circuit pump trials, of which there were four in the first quarter. We won three of them. One is ongoing.

So I'm very happy that whenever competitively, we put ourselves up against all of our competitors that we can demonstrate the lowest total cost of ownership and better performance from our product. So that model is completely intact, and we feel good about that. Our competitors are pushing hard on pumps. We know that. We see it. We're defending it strongly for all the great reasons that we can in terms of our technology and our service capability.

And so yes, from a pricing point of view, the margins remain good, and so we're very happy there. In terms of the impact from the conflict, as I said earlier, we're not seeing any significant impact at the moment. We don't expect a big impact on our supply chain.

We know that potentially, if it goes on for a long time that you might see oil shortages in some parts of the world. But I think we're quite a long way away from that as we see it, and my CFO as a former BP man has a pretty good view on that. So he's watching that closely for us. So yes, I think as we see it today, we're quite a long way away from any broader contagion, but it is a crazy world. And so we are remaining alert. And as ever, plan for the worst and hope for the best.

A quick follow-up, if I may. When we think about those temporary mine closures, is there any steer you can give us on cadence here on how that might come right?

Yeah. A lot of them were either weather-related because of cyclones in Southeast Asia. So they're now back up and running, and we're starting to see orders come through. We've seen some on -- ongoing effects of geological challenges in some parts of the world. But again, customers ramping back up and working through that.

So there's very little that we saw in those disruptions in the first quarter that we see as permanent. And we plan our year, we plan our aftermarket demand bottom up in terms of customers' production plans. And in pretty much all the cases where we saw the disruptions in the first quarter, those production plans are now normalizing, and that means that the aftermarket will normalize.

In the interest of time, we currently have no further questions. So I'd like to hand back to Jon for some closing remarks.

Thank you very much. So thanks for participating in the call today and for listening to our speech and Q&A. We appreciate that. If you have any follow-on calls through the course of the day, and please get in touch with our IR team and we'd be very happy to help.

But in the meantime, I look forward to catching up with all of you in person before too long. Thank you very much.

Speaker 0

This concludes today's call. We thank everyone for joining. You may now disconnect your lines.

Good morning, everyone, and welcome to Weir's 2025 Full Year Results Presentation. Before we start, I would like to draw your attention to the usual cautionary notice on forward-looking statements. We've found a very strong year. So there's a lot to cover today.

I'll start with introductory remarks, then Brian Puffer, our CFO, will present the financial review. I'll then return to cover our strategic progress during the year and our outlook for 2026. And after the presentation, both Brian and I look forward to answering your questions.

So beginning with our equity case, we is delivering on the sustainable growth and shareholder returns that we promised. We are today is a focused technology partner to the mining industry with market-leading hardware and software solutions, both of which leverage our secret sauce of mission-critical technologies and unmatched customer intimacy to deliver a unique value proposition protected by high barriers to entry.

We are poised to benefit from multi-decade favorable market demand tailwinds for critical minerals while the adoption of new technologies to enable sustainable mining will only boost the potential opportunity set available to Weir. And as we now pivot our focus to growth, we are driving returns with strong through-cycle organic growth excellent execution and compounding M&A. With the platform we now have in place, there is significant potential for incremental value creation.

Turning to our results. In 2025, we delivered a strong financial performance, reflecting Weir's market-leading technology and deep customer relationships. We successfully navigated the uncertainty arising from tariffs and global supply chain disruptions, leveraging the flexibility creates in our operational footprint to provide seamless service to our customers. On revenue, our strong operational performance delivered 6% constant currency growth year-on-year. This performance reflects a combination of high demand in the aftermarket, flawless execution on our OE order book in the fourth quarter and contributions from acquisitions completed in the year.

We expanded our operating margins by 150 basis points, exceeding our target of 20% a year earlier than expected reflecting both the success of our Performance Excellence Program and the quality of our new software solutions business. We once again delivered against our free operating cash conversion target of 90% to 100%, supported by a disciplined operational performance and the maturing of our Weir business services functional capability. We grew our constant currency operating profit by 15%, significantly ahead of last year, and underpinning another year of predictable dividend growth. And finally, our absolute Scope 1 and 2 emissions are down 31% now against our 2019 baseline, putting us ahead of our original 2030 SBTI target for a 30% reduction.

On top of our strong financial performance in 2025, we also made significant strategic progress in advancing our growth strategy with meaningful self-funded acquisitions and partnerships in digital, geographic expansion and product extensions. As we continue to integrate these businesses into our One Weir platform, all transactions are performing well and expect to generate returns well above our cost of capital. Together with several new product launches, we've considerably expanded our addressable market of mission-critical solutions and created a unique technology proposition to the mining industry. In summary, 2025 was an exceptional year for Weir, and our achievements reflect the dedication of my outstanding were colleagues around the world. whose commitment to our customers and passion for our purpose underpins our success to date and who are more excited than ever about what we can deliver in the future.

I'll now hand you over to Brian to take you through our financial results in more detail.

Thank you, John, and good morning, everyone. As John just mentioned, we are delighted by the operational execution from across the group during 2025, which is evidenced in our strong financial results. During the year, orders increased by 7% to GBP 2.6 billion, supported by our high level of demand for our market-leading products and strategic acquisitions.

Original equipment orders were unchanged year-on-year, reflecting positive underlying demand for mine site expansions and debottlenecking solutions, offset by the phasing of large greenfield projects. Aftermarket orders grew by 8%, supported by high mining activity levels and contributions from acquisitions. Revenue increased in kind by 6% to GBP 2.6 billion reflecting strong execution of our order book, particularly in the fourth quarter.

Original equipment revenue increased by 2% from shipments of medium to large projects in Minerals as well as smaller brownfield optimization and debottlenecking projects. Aftermarket revenue grew by 8%, supported by hard rock mining production trends which drove demand for wear parts and expendables across both divisions.

Operating profit increased by 15% year-on-year to GBP 518 million, resulting in operating margins of 20.2% and an increase of 150 basis points. This strong performance reflects both incremental performance excellence savings and contributions from our acquisitions in software solutions, which I will cover in a moment. Profit before tax of GBP 447 million was GBP 19 million ahead of last year despite a GBP 22 million translational FX headwind. Growth in profit delivered a 3% increase in EPS for the year to 123.8p per share.

Turning to cash. We're free operating cash conversion of 92% was within our target range of 90% to 100%, reflecting an increase in profits, offset by higher working capital due to a buildup in inventory prior to the closure of some of our operations as part of Performance Excellence as well as the impact of U.S. tariffs on our year-end inventory balances.

As expected, following significant acquisition activity in 2025, net debt-to-EBITDA increased to 1.9x toward the top end of our range following acquisitions. Return on capital employed likewise decreased by 140 basis points to 17.9%, though still well above our cost of capital. Taken together, our strong financial performance in 2025 underpins our full year dividend of 41.7p per share, a 4% increase from last year.

Turning to results in each of our divisions, starting with another strong performance for Minerals, which included the launch of new technologies to expand our addressable market, the completion of the Townley acquisition and the delivery of several key performance excellent work streams, which supported further margin expansion.

Market conditions are positive with gold and copper prices reaching all-time highs and driving strong demand as customers sought to maximize production from existing assets. Mineral orders grew by 5% in the year, original equipment orders were stable, reflecting a lower level of large orders as expected. Excluding these projects, orders increased by 7%, highlighting the positive underlying growth in small- to medium-sized projects. In aftermarket, orders grew by 7%, supported by our expanded installed base, higher demand for pump spares and communation parts. As well as orders from Townley during the 4 months of our ownership post completion. Revenue increased by 6%, reflecting original equipment product shipments, positive mining market trends and a contribution from Townley.

Aftermarket revenue grew by 7% supported by strong performance in North and South America and underpinned by positive hard rock mining production growth in these regions. Operating profit increased by 11% on a constant currency basis to GBP 406 million with performance excellence work streams and operational efficiencies, delivering further margin expansion to 21.9%. And an increase of 100 basis points. Our ESCO division delivered an excellent performance with growth in core GET products, expansion of the installed base of Motion Metrics solutions and further operational improvements in the division's foundry network.

Orders grew by 11% with strong demand for our core GET products in mining and infrastructure markets, partly offset by normalized demand for dredge solutions. Excluding the GBP 44 million contribution from Micromine, like-for-like growth was 4%. Revenue was stable on a like-for-like basis, reflecting strong underlying aftermarket growth in core GET markets and Motion Metric Solutions, offset by the phasing of mining bucket deliveries, which impacted original equipment revenue. Total divisional revenue increased by 6%, including 41 million for Micromine.

Operating profit increased by 22% to GBP 152 million with margins expanding 260 basis points to 21.4%, reflecting a contribution from Micromine of 120 basis points and incremental Performance Excellence savings. While the financial performance of Micromine is included within ESCO, we committed to update you on the key business operational metrics, which drive value post acquisition. In Micromine, customer retention increased to 94% with low churn supported by our semiannual product updates and world-class support. Recurring revenue for the year grew to 88% and as expected, annual recurring revenue grew 24% on an annualized basis. Turning to operating margins, which increased 150 basis points year-on-year to 20.2% and including a 10 basis point headwind from translational FX, primarily reflecting the deflation of the U.S. and Australian dollar.

The key driver of margin expansion in the year were a marginal shift in minerals revenue mix towards aftermarket resulting in a 10 basis point tailwind. Incremental savings from our Performance Excellence program of 140 basis points highlighting the compounding benefit of the program with cumulative savings now at GBP 59 million. Initial benefits from our acquisitions in the year contributed 30 basis points as expected. And a 30 basis point headwind from increased R&D investment, supporting new product launches and material science advances consistent with our policy of investing 2% of sales and R&D.

Taken together, these factors resulted in margins of 20.2%, achieving our goal of 20% margin a year early with more to come. Adjusting items totaled GBP 73 million for the year with costs relating to exceptional items of GBP 47 million. Costs across the 3 pillars of Performance Excellence program were GBP 45 million pounds, bringing the final total program costs to GBP 113 million below our previous guidance. Acquisition and integration costs were GBP 22 million, including GBP 5 million arising from the unwind of the fair value uplift on inventory for Townley. During the year, the U.S. entity, which held asbestos-related claims enter Chapter 11 bankruptcy proceedings and has subsequently been deconsolidated.

We believe the remaining provision to be sufficient to cover future exposures with no further charges related to this provision expected. Other adjusting items reflect normal amortization of acquisition-related intangibles, which increased as expected and charges associated with asbestos provision to the date of bankruptcy.

Turning to returns, where adjusted operating cash decreased by GBP 25 million to GBP 566 million, reflecting increased working capital outflows due to phasing of safety inventory supporting our Performance Excellence activities and large original equipment order deliveries, both of which we expect to unwind as operations rebalanced across our platform in the coming year.

Working capital as a percentage of sales increased by 170 basis points to 22.4%. Though as mentioned, we expect to return towards our 20% target as our operations normalize. CapEx was marginally lower year-on-year at 1x depreciation compared with 1.1x in the previous year, while free operating cash conversion decreased slightly to GBP 475 million resulting in free operating cash conversion of 92% within our target range for the year.

Turning to liquidity, where free cash flow decreased to GBP 267 million, reflecting higher tax payments increased finance costs and outflows related to settlement of financial derivatives in relation to our refinancing activities. Following the self-funded acquisitions of Micromine, Townley and Fast2Mine and the strategic investment in CiDRA Net debt-to-EBITDA was 1.9x on a lender covenant basis within our target range following acquisitions.

Jon will provide more detail on our 2026 outlook later in the presentation. Though this slide sets out some key modeling considerations for the year ahead, including: First, we expect net interest cost to be GBP 90 million, reflecting our acquisition and refinancing activities in 2025. We expect CapEx and lease spend of around 1.3x depreciation as we look into making investments in our foundries as well as the start of a company-wide SAP S/4 implementation.

We remain on track to delever at pace and expect to return towards our normal operating range of 0.5 to 1.5x by the end of 2026, supported by a free operating cash conversion of 90% to 100%. We anticipate exceptional cash costs of around GBP 25 million to GBP 30 million, primarily relating to acquisition and integration costs from our M&A activity in 2025 and from the completion of final Performance Excellence related products.

And finally, we expect our effective tax rate to be 28%, in line with the current year. As we look ahead, we have taken decisive actions to address legacy balance sheet exposures, positioning Weir with a stronger and cleaner balance sheet as we pivot our focus to delivering growth. As mentioned earlier, we have deconsolidated the U.S. entity containing asbestos provision and expect the existing provision to be sufficient to cover any future exposure.

In addition, our defined benefit pension schemes have gone from a circa GBP 100 million deficit to a funded surplus making the need for any future special cash contributions unlikely. And finally, as we enter the final year of our Performance Excellence program, we have increased our total savings target to GBP 90 million. By the end of 2025, we have expensed all program-related costs totaling GBP 113 million below our previous guidance.

Going forward, we will continue to incur acquisition and integration costs as we convert our M&A pipeline, which will drive amortization from related intangibles. In future, this means we will have a simplified exceptional items. Improving the quality of our earnings and the consistency of our cash generation.

To summarize, mining markets remain supportive with high levels of activity in our core mining markets as our customers deliver on the growing demand for critical metals. With ongoing expansion of our installed base, combined and contributions from acquisitions, we see a strong underpin for future demand for our aftermarket products.

In 2025, we executed strongly delivering revenue and margin growth while executing on our Performance Excellence program ahead of schedule and under budget. Cash conversion remained within our target range, and we delivered another increase to our full year dividend. We completed the acquisitions of Micromine, Townley, and Fast2Mine, and while we expect some additional costs arising from refinancing of this acquisition activity, these investments will be accretive both to growth and margins.

Our strong cash conversion will support deleveraging at pace and our strong clean balance sheet is positioned for growth. Overall, we delivered a strong financial performance in the year. And as we move through 2026, we have strong momentum across the group and are confident in delivering another year of growth. Thank you, and I will now hand back to John.

Thank you for that, Brian. Now turning to our business review. I'll share more details on our strategic progress in the year and set our view of market conditions and the outlook for 2026. Starting with our Weir strategy where our pillars of people, customer, technology and performance are fully embedded throughout the organization with top to bottom alignment on our priorities across our global team. At our Capital Markets Day in December, I presented our refreshed framework, acknowledging the opportunities and challenges which come as were continues to evolve.

Going forward, our strategy specifically reflects the adoption and utilization of AI, the opportunity we create through mining industry thought leadership, our capability to deliver transformational solutions to our customers and our capacity to leverage lean operations and high-quality and efficient global business services. As I mentioned in my introductory remarks, in 2025, we made significant progress on advancing our growth strategy in digital, geographic expansion and product extensions evolving our business in line with our clear capital allocation policy.

So taking each in turn, on digital, we accelerated our strategy by embarking on our mission to create a global leader in mining software solutions with Micromine, Fast2Mine and Motion Metrics, we've created a market-leading end-to-end offering, and 2026 is the year of bringing it all together. Progress-wise, the integration of Micromine is complete. Fast2Mine has started very strongly in pursuit of the 1-year earnout.

Motion Metrics has officially now moved into the software segment within ESCO. With this platform, Weir will connect domain knowledge in extraction and processing with upstream data to drive unique customer insights and drive productivity at a time when the industry needs it the most. Our cross-selling pipeline continues to build. And I'm really encouraged by the great collaboration going on between our hardware and software businesses as we leverage their collective strengths to grow faster.

Turning to our geographic presence. We made several investments enhancing our footprint in some of the world's fastest-growing mining regions. The acquisition of Townley strengthened Minerals presence in North America, adding more phosphate exposure and completing our global foundry capacity plans for the division.

Sales and marketing integration is now well underway. And we're focused on incorporating the Florida foundry into our Zero Harm safety culture with investments already made in upgrading the physical environment. Earlier this week, we announced the completion of our acquisition of the remaining share in ESCO'S Chilean joint venture ESEL, strengthening ESCO's ability to serve customers across South America and bringing more foundry capacity in-house. Between signing and completion, the ESCO team has worked tirelessly with great support from Elecmetal, to prepare customers for the transition and set up our own sales and logistics capability in Chile which leverages the existing minerals footprint.

This means we're ready to hit the ground running on completion this week. And at the Future Minerals Forum in January, we signed a joint venture agreement with Olayan a powerful partner in Saudi Arabia, marking a significant step forward, which positions were for growth in this rapidly expanding mining and metals market. We're delighted to have Olayan as our partner again, following our previous successes in oil and gas.

But finally, we invested in filling product gaps in our future-facing mill circuit solution. Just as we did with ENDURON and ELITE screens, we have in-house developed the ENDURON vertical stirred mill with novel proprietary features, offering course, fine and regrind capabilities with dramatically lower energy costs than ball mills. We've already received our first VSM order, generating an important reference for the new technology. In addition, we signed a global collaboration agreement with CiDRA to commercialize their new P29 separation technology, which offers improvement in throughput of over 40% compared to traditional grinding circuits.

Like our other flow sheet solutions, P29 is modular meaning it can be retrofitted onto existing sites to improve productivity as well as form the core technology to future greenfield flow sheets. Now moving back to progress on our organic strategy where, in 2025, we is leading with real purpose in promoting the sustainable and efficient delivery of critical resources. For example, in November, we launched our newest industry report untapped which is driving new conversations about water and mining with our leading thinking, technological expertise and broadened flow sheet offering, we're strongly positioned to support the industry in a shift to more strategic water management.

While delivering technology for our customers to meet their sustainability challenges, we're also delivering a more sustainable wear, inclusive of recent changes to our foundry footprint and expected market growth, we still expect to meet or exceed our Scope 1 and 2 emissions reduction target of 30% as a group by 2030. Externally, we have retained our A score for climate transparency from CDP for the fourth consecutive year and along with our updated climate transition plan, we continue to advocate for the right frameworks to drive progress in the heart to abate mining industry.

Turning to our people pillar. We continue to create a safe and purpose-driven workplace for all colleagues. On safety, our ambition is 0 harm. But in 2025, we fell short as our total incident rate increased over the prior year. Encouragingly, through focus on leadership and best practice, there has been a reduction in the number of recordable incidents in the second half of the year, and we're committed to maintaining this momentum through a broader strategy refresh in 2026.

We continue to invest in creating an inclusive environment where people can do the best work of their lives. Employee engagement remains high with our Net Promoter Score of 49% in the top 10% of manufacturing companies globally as benchmarked by Peakon. Within Software Solutions, our full year employee retention rate of 87% reflects the success of the integration program at Micromine.

External recognition continues with Weir ranked in the top 10 of Britain's Most Admired Companies and achieving Tier 1 status in CCLA's Mental Health Benchmark for the first time alongside only 9 other companies. For me, the real highlight of the year that demonstrates the strength of Weir's culture has been the collaboration on cross-selling software solutions through our global footprint. Early signs have been very encouraging with war introductions to several Tier 1 miners leading to many new opportunities, our first license sales and a strong pipeline of additional opportunities developed for 2026.

Turning to our customer pillar, where our GBP 40 million order to provide tailings solutions to Codelco in Talabre, Chile illustrates both our proven experience on large-scale, sustainable trainings operations as well as the importance of local presence, delivering the world-class service were is known for.

We are delivering on our digital vision, our commitment to annual upgrades and software features such as fully integrated stope optimization with advance underpins micromine market-leading recurring revenue growth and customer satisfaction. Motion Metrics had a great year in 2025 and is now transitioning to the full annual subscription-based service model, which has been so powerful for Micromine.

Underpinned by our long-standing relationships with customers, and our technological leadership, Minerals continues to gain market share in large mill circuit pumps, converting over 90% of competitive field trials during the year, consistent with our historical success rates. Likewise ESCO grew its market share in core mining markets, completing 159 net major digger conversions, an increase in successful conversions of 18% versus the prior year.

While ESCO continues to be the clear market leader in the mining GET market globally, we have the opportunity to leverage the brand to access new opportunities through our attachment strategy. Working directly with our customers, we designed a production master, a new highly engineered hydraulic shovel bucket that is more robust in key areas of where allowing longer cycles between maintenance. Our direct-to-customer approach has led to exceptional growth in Australia.

In the past 3 years, ESCO has increased bucket sales in this key market by 700% with more to come. Turning to the technology pillar where we continue to invest in our core hardware solutions as part of our growth strategy, maintaining our market leadership across the mill circuit, Minerals released new ENDURON crushers and next-generation mill circuit pumps delivering higher productivity, reduced downtime and lower carbon emissions for our customers. Our next intelligence solutions are transforming how we create and capture value as customers focus on increasing throughput and minimizing unplanned downtime.

We have onboarded over 110 customer sites over the last 3 years, and in September, we announced a new strategic partnership with Viking Analytics to enhance our digital wear monitoring solution with AI-enabled early predictive wear detection. In ESCO, we recently launched Vertesys, our next-generation GE system for infrastructure markets, which provides an increase in wear-life and reduced adaptive change time which building on NEXUS in mining reduces operational downtime and total cost of ownership for our customers.

By continuing to innovate, we are further pushing the boundaries of slurry pumping at Teck, Highland Valley Copper. We built our relationship on the existing concentrator line around other installed products. The customer wants a higher output and less downtime, initially relying on next intelligent solutions and support from our nearby Kamloops service center as a result of our demonstrated service and technology leadership, we were invited to trial our MCR 760, which is now the largest story pump working in North America ultimately displacing a long-established competitor on site.

Turning to the performance pillar, where we've upgraded our final cumulative performance excellence savings target by GBP 10 million taking us to GBP 90 million overall. With final total cost for the program of GBP 113 million, GBP 7 million less than our prior estimate, the program has delivered an excellent return on investment and build continuous improvement capability that will keep delivering efficiencies going forward.

Each area, capacity optimization, lean process and GBS has overachieved repeatedly with minerals, ESCO and corporate teams working together seamlessly. As we enter the final year of delivery, we can reflect on a highly successful program which has not only underpinned our operating margin expansion, but also created a scalable platform that will enable future growth for many years to come. So now looking ahead, Activity levels in our core mining markets remain strong, with customers increasingly investing in expansion and debottlenecking CapEx as supply deficits in critical minerals emerge. This shift is driving positive policy developments in key jurisdictions such as the United States and Chile, where permit and licensing regulatory frameworks are being reconsidered to allow new projects to develop faster.

Meanwhile, engagement among our mining customers and ePCMs on technology and innovation is encouraging as the need for new and better solutions the challenges of significantly increasing capacity in the near term become ever more apparent. Additional demand drivers such as AI, defense manufacturing reshoring will further underpin growth in ore production.

Faced with declining ore grades and growing geological complexity as the best resources are mined, customers are putting more stress on their existing equipment, leading to more maintenance events. Together with our growing installed base, current market conditions are supportive of increasing need for our spares, expendables and services. So turning to our outlook for the year ahead.

We entered 2026 with a strong opening order book and expect to see increasing CapEx, which will support OE growth. In the short term, we see a continued bias to brownfield projects with the potential for larger expansion projects to accelerate, although as ever, the timing is difficult to predict. Demand for our aftermarket spares and expendables is strong. Coupled with modest price increases, we have a solid foundation to deliver another year of mid-single-digit growth in aftermarket revenue while our software businesses remain on track to deliver further strong growth in line with our acquisition expectations.

So overall, we expect another year of growth in revenue and operating profit with 50 basis points of operating margin expansion. While we've upgraded our final Performance Excellence savings target, we expect some portion of the benefits to be reinvested in R&D and IT systems, specifically a final investment in a single instance global ERP key to unlocking another level of future operational efficiencies and margin expansion.

Finally, we expect improvements in working capital and result in free operating cash conversion of between 90% and 100% consistent with our medium-term guidance. So putting together today's key messages. We delivered a strong operational performance in 2025, reflecting flawless execution of our order book, robust aftermarket growth and contributions from acquisitions completed in the year. We made significant progress in advancing our growth strategy with meaningful self-funded acquisitions and partnerships in digital, geographic expansion and product extensions. We continue to deliver our Performance Excellence program at pace, delivering savings to date of GBP 59 million and upgrading our final target to GBP 90 million in total cumulative savings.

In '26, we expect to deliver another year of growth and margin expansion supported by a positive market outlook. And finally, we're delivering all the above in the right way, providing our people with purposeful work and personal growth and customers with innovative technology solutions that accelerate sustainability in mining. Looking forward, the long-term value creation opportunity for Weir is even more compelling. We've created a global leader in engineered hardware and software for the mining industry. Demand for critical metals continues to build and customers are increasingly recognizing the need for new, more efficient solutions to unlock future supply.

And finally, we're providing a clear pathway to sustain growth and total shareholder returns through a clear capital allocation strategy, sector-leading operating margins and consistently high cash generation. Thank you for listening. And Brian and I will now be pleased to take any questions that you have.

[Operator Instructions]. Our first question is from Jonathan Hurn at Barclays.

Just a few questions for me, please. Firstly, can you just sort of explore the sort of the growth outlook for FY '26. So obviously, you're guiding to mid-single-digit growth. That's pretty similar to -- or I should say, mid-single-digit organic growth, that's pretty similar to what you did in FY '25. So essentially, there's no real pickup coming through I mean the question is really what drives that pickup? Is it essentially bigger large orders coming through. And if so, can you just sort of talk us through the outlook for those? And do you feel that they could potentially come through in the second half of this year? Or would it be more FY '27?

The second question was just on the topical Reko Diq. Just what you're seeing there, please? I mean, did all the orders get shipped that were scheduled. What's left to go there in terms of OE? And how do we think about sort of the aftermarket revenue there? Obviously, does that get pushed out further on the back of sort of the disruption.

And then the third and final question was just on Micromine. Obviously, recurring revenue growth was 24% in FY '25. I think to get that deal math to work on a 3-year basis, that growth rate, I think, has to be higher. So how should we think about that sort of recurring growth going forward, particularly in 2016? Do you think it can accelerate from the 24% that we did in FY '25, please? There are three questions.

Yes. Thanks for that, Jonathan. So yes, I think on the growth question, look, stepping back, we're seeing a continuing positive demand environment across the global mining and metals complex. Driving ongoing demand for aftermarket and a consistent level of smaller OE brownfield debottlenecking type projects. So that underpins us being bang in the middle of the fairway on the organic growth across the aftermarket and fairly stable levels of original equipment on a brownfield.

We do expect that or we see that the -- I would say, the environment and the backdrop in terms of potential for further growth in CapEx to come through is looking increasingly positive. I would say that -- our large customers are probably more bullish this year than they were at this time last year. There is an appetite, I think, to invest to grow production given the emerging supply deficits, which probably come through quicker than people expected in terms of some commodities and also what's going on politically in terms of government and regulatory interventions to try and free up some of the things that have been robust to the development of greenfield projects.

So I think the setup is feeling increasingly positive. But as ever, it's really, really difficult to call when these things will come through. So I think the pipeline is good. We can see the projects out there. But at this stage, it's not really the right thing to do to say, look, we're definitely going to get it this year. We may do. We may sort of see in the latter part of the year a pickup, but we'll call it when we really start to see it coming through. But I think more broadly, the general environment remains highly positive in terms of the demand environment with upside. That's how I'd characterize it.

In terms of Reko Diq look, from a balance sheet perspective, we've now delivered and been paid for the HPGRs. So we only got a relatively modest amount left in the order book. that is covered by advanced payments, so -- and cancellation clauses. So we have no balance sheet exposure at all. Clearly, we would love to see that mine get built and the aftermarket opportunity to come through. And we're hopeful that it will do.

We note that it's under review at the moment rather than anything more firm than that. We know that the Pakistani government is an investor in the project. So there is a real local interest to build the mine and start the development of the mining industry. And we are actively engaged with that at the political level in Pakistan. So we're hopeful, but we don't know at this point in time and obviously in the event of the weekend at a further, sort of, complication, if you like, to how that may play out. So we'll see. So bottom line is we have no exposure, and we wait and see whether the longer-term aftermarket opportunity will come through.

On Micromine, I would say that, yes, I mean, the recurring revenue growth that we outlined is very much in line with the historic performance levels of the business. So where we expected it to be on sort of an organic basis, if you like. And 2025 has been all about us setting up the ability to exceed that growth in terms of leveraging the minerals and the ESCO footprint globally to essentially be able to drive revenue growth above that level. And we're very clear that over the next 3 years, we want to deliver, we need to deliver higher revenue growth than that. '25 has been about the setup. We've now got a great pipeline. We've had our first incremental license sales from a Tier 1 customer off the back of the -- of leveraging the existing platform. So that's working in line with plans. That will come through as we expect, and that will -- as we go through '26, we should see an acceleration in that growth.

Our next question is from Lush Mahendrarajah from JPMorgan.

I've got two, if that's okay. The first is just on the margin guidance. I mean, 50 bps expansion would be helpful if you just give us sort of quantify the moving parts of pluses and minuses in that. And then in terms of within that, the R&D and IT investment, I know you sort of touched on it, but be interested to hear what exactly you're doing there?

And also, I guess, how we should think about that cost as we sort of look forward? Is it -- should we be thinking sort of a continued headwind in the outer years? The second question is just on aftermarket orders. I think the growth was a bit lower in Q4, but I know you have that sort of tough comp from that multi-period order. I guess can you just remind us what the underlying aftermarket was? And I guess, should we be seeing that accelerating from here, just given some of your gold and copper customers are running their sites a bit harder, those are my two questions.

Okay. Thanks for that. Well, on the margin point, I'll make an overarching comment and then turn it over to Brian to take you through the moving points. But I just want to remind you, we've been very consistent on the setup for our margins and having achieved what we've achieved over the last few years to get above 20% operating margins. The setup has been very clearly that we want to be a 20-plus a 20%-plus operating margin company, and we're going to have the ability to sustainably stay there through the ongoing benefits of performance excellence and continuous improvement.

And within that, we will have the ability to invest in opportunities to develop the business through R&D or other ways. We'll have the ability to deal with any headwinds that may come from a CapEx cycle and therefore, OE kind of margin hit as it were. And in today's quite difficult world, have the ability to weather any bumps in the road that may come along. So that's really how we're thinking philosophically about the business. The other thing I would say in terms of the overarching comments is that clearly, every year, we have outperformed our guidance in terms of operating margin targets in the journey over the last 4 years from middle teens to now north of 20%.

So at this point in the year, where we're guiding, we think 50 basis points is an appropriate place to be. We've got a high level of confidence in delivering that. We're quite conservative, as you know, including on our pricing assumptions. We're probably towards the lower end of the range of what performance excellence might deliver. So the 50 basis points is our sort of PAT high confidence level in terms of margin expansion at this point in time. But again, as I pointed out, our track record is that we outperform. In terms of the moving parts as we see them today, Brian?

Yes. Well, thanks, Lush, for the question. And the moving parts are actually quite simple this year. They all could change. So mix we're seeing is pretty neutral, not having really an impact. As we sit here today, the FX, we're not expecting a big headwind or tailwind. So there is no real movement in terms of margin.

Obviously, we'll have to see how that plays out. So there's really three main levers in the margin bridge. On the positive side, we have a 110 basis point increase for Performance Excellence. As John said, we've increased our guidance from $80 million to $90 million. And we hope to deliver more than that. And so that's what we're actively working on to do. With the acquisitions, we should see a 20 basis points increase in our margins. So that's having a positive impact. And offsetting that is an 80 basis points decrease, and that's the investment that Jon talked about. Both in terms of some new systems that we need to implement and which will deliver further benefits in the future as well.

And the R&D type expenses, building out new product lines. And Jon talked about some of the things we're doing in that space in his speech. But obviously, we need to invest in that and to grow. So, that's sort of the slight down on the margins, and that gets us to 20.7%. But as Jon said, that's -- we feel very confident in that number, and our goal is to beat that.

Thanks, Brian. And yes, Lush, on the Q4 aftermarkets, look, I'm delighted with the orders that we got in the fourth quarter. It was an incredibly -- probably the highest quarter in terms of aftermarket we've seen, as you say, the comp was tough, and that was because we had the other half of the multi-period order in Q4 last year, which obviously was all recognized in Q2 in 2025. So you add that back and minerals would have been 2 or 3 percentage points higher in terms of its aftermarket growth year-on-year on a like-for-like basis.

But again, I think you have to look at the aftermarket performance over the course of the year for both businesses was exactly what we said it would be at the start of the year. We said mid-single digit. Both businesses delivered 5% aftermarket growth. And I was really delighted with the strength of the orders in the fourth quarter. So it means we enter 2026 with a really good order book, and I think that's just indicative of going back to Jonathan's first question. that's indicative of the setup in the markets and the opportunity for growth as we move through into 2026.

And so just to follow up on that, do you think that sort of -- when you think about aftermarket order growth for this year, do you think that sort of mid-single-digit level again? Or the scope...

No. I mean I think that's our working assumption at this point in time based on the underlying fundamentals and growth drivers that we see. Again, could it be more than that than absolutely. I mean we're obviously watching events in the Middle East very closely and how that plays out. I don't think it changes any of the fundamentals. But yes, I mean, again, mid-single digit is our sort of high confidence level guidance at this point in time. The setup is strong. Might we outperform and the potential is clearly there.

Our next question comes from Vivek Midha from Citi.

Just a couple of quick ones for me. So the first one is on the free operating cash flow guidance of 90% to 100%. You did highlight some headwinds from the cash costs of the Performance Excellence Program, but also signaling the net working capital sales ratio could come down from a temporarily higher level in 2025.

So were those the two key moving parts? Is there any upside risk to your guidance there? My second question is just around maybe the cost implications from higher raw material prices, how are you seeing pricing evolving for your spares and in the broader aftermarket?

So thanks for the question on cash. Yes, our cash delivery was 92%, well within our range. There were some headwinds in the fourth quarter. One of the largest ones was with some of our performance excellence, we've been moving operations and closing operations. And one of the things that we pride ourselves on Weir is making sure our customers always have their equipment. And so with these moves, we built up some safety stock at the end of this year, which contributed to higher inventory values.

We saw some impact from tariffs on the inventory, and there was just some normal buildup with such a large delivery in you may flip out of inventory, but some of that goes into receivables. So your working capital doesn't go down. So we ended up at a much higher working capital as a percentage of sales in '25 compared to '24, I think it was about 170 basis points. We see that returning to normal, and our goal is to get that back down to around the 20% mark. So there were some one-offs this year that we see normalizing through 2026.

Yes. And I would just add to that. If you go back to '24, we delivered 102% where we had benefits of some advanced payments coming through. And this year, we're carrying some extra inventory for the reasons Brian sets out. So we're very, very confident that the business is absolutely capable of delivering the average through the cycle, the middle of that range of 90% to 100%. So we feel really good about that. And again, we've built a track record of now consistently delivering that. On the cost point of view, in terms of our pricing assumptions at the moment, we've built in our expected view of inflation across raw materials and other input costs at this point in time.

Obviously, again, there's now a little bit of uncertainty as to whether we might see higher levels of inflation in commodities. Certainly started with the oil price. Does that flow through into some of the other raw materials that we use? Possibly. And again, I just -- I'd refer you back to the track record over the last few years of consistently being able to -- where we see inflation or rising costs managing it well through our network and being able to mitigate to some extent but where we can't, then using pricing to be able to protect our gross margins. And you all know that the gross margins that we earn on our spares on the aftermarket is the real driver of profitability and cash for the business.

And we've managed the business on those gross margins, and we've consistently demonstrated that we can do that and maintain or grow those gross margins through pricing. So I think if things change, we have the ability to adjust the assumptions and pass through a little bit more pricing. Just a related Point, I'd comment on at this point, obviously, there's kind of been some new news on tariffs, further twists and turns, but the effect of that on us is pretty immaterial to be honest, and no overall change in terms of what the President Trump latest announcement on tariffs are.

Our next question is from Andrew Douglas with Jefferies.

All my questions have really been answered, but I will add one, please, to the mix. Can you talk about the M&A pipeline? And your intentions over the next, let's call it, 12, 18 months. You clearly bought two large acquisitions in software and other the two couple of more bolt-ons including one that completed last week. Can you just talk about where you want to take this business now from a software perspective? And if you can throw in your thoughts on AI and how you're using AI as part of your software proposition. And maybe you want to comment on whether you think it's a risk given the world's a slightly different view of software event?

Yes. Hi, Andy, thank you for the questions. Yes, look, from an M&A pipeline, obviously, 2025 was a very busy year for us and some -- the acquisitions that we've been tracking for several years all came through in a flurry, which was great that we were able to be successful and get them over the line. As Brian said in his speech, it doesn't mean that we sort of went up towards our higher limits in terms of our net debt to EBITDA.

So we see 2026 really as a year of coming back down into the normal operating range and using the cash generation to bring the debt level back down. So that's very much the focus. But it doesn't mean that we're done with our acquisition strategy. We continue to see opportunities both in the software world to further develop on the platform that we've built, but also in the more traditional equipment space as well. So while we're going through a year of cash generation and paying down debt, we're going through a process of rebuilding the pipeline so that as we've got headroom, we have the ability to deploy that and compound growth adding to the underlying organic growth that we will see.

And as I said, that has the potential to be hardware and software. On the software side, probably much more likely to be smaller bolt-ons such as Fast2Mine type size. We see the big -- and that -- by the way, that -- as I said in my speech, that acquisition is absolutely storming away in terms of what it's delivering so far.

The potential to add smaller software businesses into the micro mine portfolio and platform and globalize and drive growth in that way is very, very significant. So the potential to do smaller bolt-ons in software is very much there and in the back of our minds. And I think now having been through a period of consolidation, most of the software businesses of scale that are mining specific have now gone to strategics basically. So I think RPM Global was the last one of scale that Caterpillar just acquired.

So that's the dynamic there. In terms of AI, we're in -- we are stepping back. I personally believe that, as we said in our Capital Markets event in December, AI, big data and analytics, digital capability has a massive role to play in helping mining to scale up and clean up and to deliver on the commodities that are required. So we're embracing it. We talked a lot about it in our Capital Markets event.

In terms of the threat aspect of it, when we look at what Micromine does, it's clearly absolutely mission-critical in terms of mining process and mission-critical in terms of safety as well. I think for those reasons, it's very unlikely that customers are going to just kind of unleash Agentic AI on their operations and do away with the need of software. So I think I think for applications like what our software does.

I think the threat of that is very, very low. I'd also say that the ability of AI agents to write code that could compete with what we're doing is very, very low as well because our code and the value that we bring to our customers is based on years and years of data, proprietary data, proprietary training materials, it's not public. So an AI agent can't go and write the code based on that data. That's why the software that we -- the two reasons there that the software that we're providing to customers, we feel very strongly is well protected against any threat. Hopefully, that answers your question.

We have time for one more question. So the last question is from John Kim with Deutsche Bank.

I'm wondering if you could give us a bit of color on kind of the pipeline versus more recent years. which mineral exposures do you see kind of driving the growth, call it, the next 2 or 3 years? And any color specifically on copper and gold production would be helpful. we understand that pricing is quite sportive, but production volumes have struggled given a number of events. Any color there would be really helpful.

Yes. No, I think gold is obviously in a super place at the moment, driven by the geopolitical situation and return of gold is a long-term store of value, government's buying goals. Given everything that's going on in the world at the moment, we don't see that changing. And our customers are running hard to increase production and develop new capacity. So we see that everywhere in the world from a gold mining point of view to the extent that even in North America, very old gold mines that were shut down a long time ago because they were economic or being reevaluated to potentially be reopened.

So there's a lot of kind of very old brownfield activity, if you like, going on in gold alongside the production growth drivers on the larger gold mining operations around the world. So I think the backdrop for gold strong. likewise copper supply deficit there emerged earlier than I think people were forecasting driven by some of the production challenges that we saw through last year.

Clearly, the long-term demand outlook for copper is phenomenal, and it's great base. It's our largest exposure. We're hopeful that actually some of the locations that did see production challenges last year, we'll start to be able to ramp up, particularly in South America. So we're -- we're watching that closely and talking to those customers about how we can support them and bringing some of that production back up.

But clearly, there's a expansion of copper production is a massive theme, and a lot of the pipeline is weighted towards that. Equally, our third largest exposure iron ore, I think despite concerns about the demand environment there, the price has held up very, very well. And particularly for the higher grade iron ores that we're mostly exposed to then the theme there is we continually move towards green steel and hydrogen steel, those higher grades is going to remain in very high demand. So I think that plays to the strength of what we now can do from the comminution capability perspective. So I think for our big three exposures, the environment looks really, really good.

But even the areas that have been weaker over the last 12, 18 months, if you think about the PGMs, if you think about nickel and lithium, then those commodity prices have come back up, and we see customers already sort of starting to respond to that. So again, that's probably one of the areas where we would see -- where we would see potential upside from this point in time. And I think the pipeline of broader expansion opportunities, it does cover all of the above. So there's a little bit of everything in there, which sort of again points back to the diversified nature of Weir and the resilience that we have. So the relevance we have is all of the supply of these critical minerals is ramped up. Yes, it's a common theme. We've talked about our peers have talked about it, that the backdrop in terms of demand environment remains very active and strong.

Thank you. This now concludes the Q&A session. So I'll hand back to John for any closing comments.

Thank you, operator. Thank you, everybody, for questions. I appreciate that. And obviously, if there are any follow-up questions during the course of the day, very happy to respond to those as and when. But thanks again for your time today. We do appreciate it. Thank you.

Well, thank you, Phil, and welcome, everyone, and thank you all for joining us at our Capital Markets Spotlight event. It's great to see so many of you here in person. I know we also have a number of people from around the world joining us virtually. So welcome to everyone online as well.

Before we start, I just would like to draw your attention to the usual cautionary notice on forward-looking statements. Today, I'm joined by several members from the group executive and businesses. And for those attending in person, there will be several opportunities to mingle and ask questions of the team informally in breaks. And for those joining virtually, please reach out to our IR team with any queries not covered in today's event.

So where is now on a clear trajectory to deliver long-term sustainable growth and shareholder returns, and we're delivering strongly on our promise. Our focus for today is on the next phase of our journey, and how we intend to deliver on our full growth potential and compound the benefits of our strong organic business.

There are 2 key pillars to this. The first is in unlocking the huge potential for digital technology to drive productivity and sustainability in mining through both next-generation software and connected intelligent products. The second is in further enhancing the customer value proposition of our equipment businesses through continuous innovation, enhanced customer proximity through digital enablement, and leveraging the significant power inherent in the global [indiscernible].

To bring that to life, today's event will be split into 3 sections, allowing time to supplement the presentation material with interactive displays during break periods. After my introductory comments, Kristen Walsh, our new President of Software Solutions, will present an in-depth introduction to [indiscernible] and how the acquisition of an acknowledged software leader has catalyzed our exciting strategic vision to build the leading next-generation software provider to the mining industry.

And we'll then have a software-focused Q&A before our first break. For those attending in personal already, you have seen the various displays we have in the entry way. And I encourage you to engage with the team in exploring them as they offer an excellent opportunity to intrinsically understand how our differentiated solutions create value our customers. And for those joining virtually an auto queue of the video content from the displays will be available during the breaks in your session browser, so please do take an opportunity to share in the experience.

After the break, we'll return for an update on our growth strategy for ESCO and Minerals led by Sean and Andrew, including a deep dive on Minerals digital strategy. Brian will then touch on performance excellence and how we intend to sustain the continuous improvement journey, followed by closing remarks from me. After a short second break, we'll conclude the event with a fireside Q&A including the executive team of presenters. So as I mentioned at the start, we sent a strong trajectory of growing shareholder returns, and we think there's lots of opportunity to accelerate and deliver more.

A decade ago, we was an industrial pumps conglomerate with businesses with different qualities and characteristics, point industry cycles and limited in its capacity to weather external events. We began our journey with thoughtful portfolio transformation, focusing our resources on our best and most resilient business and orienting ourselves to the multi-decade market opportunity presented by the mining sector.

After reinvesting the proceeds from oil and gas and flow control businesses into the purchase of ESCO, we enter into our balance sheet. With a focused position we have consistently strong performance predictability and resilience and long-term sustainable growth. And we experienced early benefits from our strategy as we navigated the COVID pandemic with mineral disruption to our customers.

With a clear vision to generate resilient and predictable returns, we launched the Performance Excellence initiative. And since that initiatives launched, we've raised group operating margins from 17.4% in 2023 to our full year guidance of circa 20% in 2025, which is a year earlier than originally expected. And as Brian will discuss later in our presentation, the benefits from this initiative will last long beyond its completion in 2026.

As we look to our next chapter, we're clearly positioned to benefit from the transformational technological change as our customers scale up and clean up their operations and as the adoption of data and digitalization take mining productivity to a new level. As a focused mining technology leader, our secret source of leading mission-critical solutions, coupled with unmatched customer intimacy simultaneously armors with unique capabilities while protecting our market positions with high barriers to entry.

We are poised to benefit from multi-decade favorable market demand tailwinds for critical metals, while the adoption of new technologies to enable sustainable mining and license to operate will only boost the potential opportunity available to Weir. As we transition from performance excellence to continuous improvement, our attention in turn pivots steadfastly to growth. With organic growth underpinned by our resilient and predictable business model, we intend to maximize shareholder returns through prioritizing compounding M&A, applying our strict strategic and financial acquisition criteria to deliver on the opportunities we see ahead across both our hardware and now software platforms.

Our matured Weir purpose and strategy likewise reflects this pivot to growth. It's fully embedded through the organization. We have top to bottom alignment on our priorities and strong engagement across our global teams. While it's familiar pillars of people, customer, technology and performance remain a constant, we are acknowledging the opportunities and challenges which come as we evolve, specifically, the adoption of AI throughout our business, our responsibility as a thought leader in the mining industry.

Our capability to deliver transformational solutions and capacity to leverage lean operations and high-quality and efficient business services. As I mentioned earlier, our value creation opportunity is grounded in the multi-decade market tailwinds from global demand for critical metals. And the adoption of new technologies to enable more sustainable mining. With demand underpinned by several significant and well understood structural factors, our broad basket of commodity exposures are headed towards production deficits in the near future should any combination of these factors continue.

In response, amplified by national security and resilience considerations governments and agencies across the world are turning their attention back to the mining industry and revisiting previously store applications for mine development and expansion. Our customers are starting to move with more pace investing to meet growing production requirements even while average ore grades continue to decline. And as the demand on our customers' increases, so does their willingness to consider and adopt innovative technology that is necessary to deliver both the productivity and sustainability objectives of their operations. So after some difficult times for mining, it's a very exciting place to be again.

So what does that mean for Weir? Well, our combination of differentiated mission-critical, highly engineered solutions, coupled with unmatched customer intimacy position us strongly to translate these drivers into growth for our business.

The outlook for OE continues to look positive, particularly for brownfield solutions, but increasingly greenfield projects. And while difficult to call, it does feel like it's the beginning of the next CapEx cycle, and we see this day to day when we speak to the EPCM about their current projects and workloads. Now wherever OE growth comes from, either through large expansion products or regular debottlenecking, our razorblade business model means as our installed base of equipment grows, so does our high recurring recurring high-margin aftermarket revenue. Complementing this well-understood business model, our new software solutions business and further bolt-on acquisitions will bring even greater scale and profitability to Weir predictably compounding up mid- to high single digits through the cycle.

We've already announced several acquisitions this year, making tangible steps towards enhancing our organic growth strategy. And while remaining focused within the bookends of where our hardware businesses currently play, we've sought to establish ourselves as a leading mining software provider across the broader mining value chain. Our recently closed acquisition of Fast2Mine, furthers its ambition by complementing Micro mine's existing underground mine management solution with a premium open pit solution. Our acquisition of [indiscernible] seeks to accelerate our access to regions with high reserves of critical minerals, while our collaboration with [indiscernible] provides us access to what we think is going to be the next generation of separation technology.

While the timing and pace of M&A is unpredictable. I think we have demonstrated in 2025 that there is plenty of opportunity. And so as we delever through 2026, we'll focus on maintaining an active pipeline to compound our organic growth. We are, therefore, fully committed both in vision and execution to delivering excellent outcomes for all our stakeholders. We retain our commitment to grow faster than our markets, delivering compounding mid- to high single-digit organic revenue through the cycle. We commit to delivering operating margin sustainably above 20% from 2026 and and shining the benefits of performance excellence and our ongoing continuous improvement mindset. On returns, we will continue to clearly convert our earnings into cash with 90% to 100% free operating cash conversion and focus on delivering sustainable growth in return on capital employed. We will remain highly resilient as we always have been, given the benefits of our aftermarket-focused hardware business and the addition of our new scalable, high-margin software businesses.

And we will achieve these outcomes while delivering both for our people and for the planet. Now as we deliver on these commitments, our ability to quickly deleverage our balance sheet will give us optionality, enabling us to take action to prioritize growth in TSR balancing investment for growth with dividends and special returns as and if appropriate.

Before concluding my introductory remarks, I'd just like to take a moment to reflect on the current state of the wider mining industry and why we're so excited about our strategy going forward. So challenge with processing millions of tons of earth per day, the mining industry's historic conservative approach has fostered preference for legacy equipment analog control systems and manual decision-making. It was just a scale play.

But it's now obvious for all to see that this runs contrary to the clear need for better productivity and sustainability as the world demands ever more critical metals. Doing what we've done in the past is just not going to work. And our customers now recognize the need for new solutions, including adoption of innovative process technology, real-time data and digital enablement and AI-enhanced process automation to mitigate risk at their current and future operations while driving higher production yields. And that really sets the scene for our technology agenda, our new digital vision and bold move into the world of software.

Our vision is now to unlock the massive potential for digital technology in its broad sense to drive productivity and sustainability and mining. And in doing so, create a global leader in engineered hardware and software solutions. So throughout today's event, you're going to learn how we're accelerating our journey to develop a globally recognized leader in next-generation mining software with [indiscernible] as the cornerstone as well as broadening the competitive moat of our equipment solutions with connected intelligent products alongside our ongoing innovation engines. Our actions today are creating a clear path toward mind to [indiscernible] data integration, enhanced performance from already sector-leading equipment, a step change in mining productivity while incrementally delivering high yields and lower downtime to the mining industry. It is indeed a very different Weir to the 1 of 10 years ago.

And with that, I'm very excited to welcome Kristen Walsh to the stage, our President of Software Solutions; to talk you through our software vision and the tremendous opportunity Micromine offers the mining industry as it scales up and cleans up. Kristen.

Thank you, John, and good afternoon, everyone. I'm Kristin Walsh, President of Software Solutions. First, to share a little bit about myself. So I've worked for Weir for 4 years. And prior to the Micromine acquisition, I led the Minerals business in APAC. I'm based in Perth, Australia. I'm an engineer and I spent the first 9 years of my career working in software. When John asked me to get involved with the Micromine due diligence, I jumped at the opportunity. Last week marked 7 months post completion, and I am pleased to share that Micromine has delivered on everything we thought we had bought and more. I'm really excited about our growth journey ahead. .

It's a privilege to join you today to share our vision for software solutions and how we're bringing next-generation technology to the mining industry. Following our acquisition of Micro mine in April, the acquisition of Fast2Mine just a few weeks ago, along with the Motion Metrics business, I'm thrilled to represent our combined software solutions business, an engine of growth and innovation within Weir. I'm proud to lead the uniting of these talented and committed teams, many in the room today with fast-scaling customer-focused software cultures, delivering exceptional sustainable value to our growing base of mining customers.

Our geologists and mining engineers understand firsthand the productivity opportunities that exist in mining. We have a shared ambition to change the industry, empowering our customers to seamlessly share data and collaborate across the mining value chain. Our vision is to provide the best feature-rich technical solutions on the market, harnessing AI and the cloud to improve efficiency. Our aim is to be the #1 technical solution available on the market in each of our point solutions. We continually develop our products to stay ahead and maintain our competitive edge. By annually, we launched new features across each of our products, guided by direct customer feedback with Micromine momentum, the name of our flagship annual release held in October each year. Our vision is centered on growth, innovation and leadership in mining software, enabled by a dedicated software sales force, relentlessly focused on building and maintaining deep lasting relationships with our customers.

Micromine equips Weir with the broadest portfolio of equipment agnostic, best-in-class software solutions across the mining value chain, supported by a dedicated team of mining experts. Like our extremely strong Warman and ESCO brands, our Signature brand for software is micro mine. Fast or mine and Motion Metrics will ultimately become product brands alongside the rest of our Micromine products. The Fast2Mine acquisition has further enhanced our capabilities in open pit mining. While the integration of the Motion Metrics business will continue to strengthen our customer value proposition, bringing eyes to our solutions with Moto metrics leading ruggedized vision technology. With the team of over 50 geologists and nearly 120 mining engineers, working predominantly in sales and customer-facing roles. We understand the challenges in mining and have credibility with our customers.

Today, our software business has an impressive global presence, [indiscernible] diverse range of junior explorers, consultants and mining customers. With our products traditionally sold to explorers or mine site professionals. Our solutions are used across 125 countries at 305 mine sites and supporting over 3,300 projects. In total, we've sold nearly 26,000 licenses globally, reflecting our global presence and reputation. Our solutions are active in tertiary institutions helping educate the next generation of explorers and mining professionals and ensuring our technology remains at the forefront of industry standards. With global scale, a strong customer base and a continually expanding portfolio, we are well positioned for accelerated growth and industry leadership.

I would now like to introduce Ivan Salina, our Chief Technology Officer at Micromine who will share how we're redefining the software experience in mining.

Thank you, Kristian. My name is Ivan Salina. I'm the CTO at Micromine. I started at Micro Mine in 1993. It was my first job out of university. The company then was only 8 people. I now have a much bigger team. And with them, we have been building our great solutions, adding to the sophistication release after release. For 7 months now, Micromine people have been part of her. The experience has been very positive. We couldn't have hoped for a better home with a company that understands mining and shares our vision and desire to be at the forefront of the mining technology. This diagram illustrates the broad coverage of the mining value chain by the Micromine products taking it from resource discovery all the way to delivering the mine or to a processing plant.

No other solution provider has such broad coverage and understanding of the mining value chain. The pictures that will be accompanying the diagram come from the various Micromine software solutions I will talk about. The first of our products along the value chain Micromine Geobank is used by exploration teams to capture, store, validate and adjust exploration data, especially data related to drilling. Micromine Origin is adjacent on the mining value chain downstream from Geo bank.

The captured exploration data flows out of Geobank into Origin. Origin is used by a geologist to create the model of the ore body used to estimate the quantity and the quality of the source in the ground. These pictures come from Micromine origin and illustrate the evolution of the model from geology model on the right, to the ore body model on the left. In both pictures, we can see the drill holes, penetrating the geology model and the ore body model. This is the drilling data coming into origin out of Geobank. The last model, the picture in the middle is what we call a block model.

Block models are at the center of all mining activities. What is the block model. So we split the space occupied by the ore body into tiny little cubes, then using various techniques, including a unique micromine [indiscernible] AI technique. We estimate the content of the commodity in each queue. Then we add up all the blocks together to determine how much of the commodity is in the ground, Hence, when they [indiscernible] board building a mine to get to it. The model is a digital win of the ore body we have discovered. Exploration and mining companies use these models to convince banks or investors about the quality of the resource around which they want to build the mine. The investors or lenders, they hire third-party auditors to only the process to create that was used to create the block model to validate, of course, the accuracy of the claim.

Micromine Origin is again used in this process. Adjacent on the mining value chain to Micromine Origin is Micromine Beyond. Beyond is used by mining engineers to design the mine. The pit, the roads, the underground caves, the tunnels leading to the Capes. Life of mine, strategic planning tools are part of Micro NBN 2. This picture illustrates a set of nested [indiscernible], that the mine will develop over, say, in the next 20 years, the mining depth, the mining sequence and even direction are generated by Micromine beyond pit optimization algorithm. The algorithm is objective is to generate peak sales and mining sequence that maximize the net present value of the mining project. Let's move further down the value chain into mine planning. Planning, commodity extraction is extremely important.

The difference between planning and not planning is the difference been making lots of money from the mine or in to close it down. Micro mine is a mine plumbing powerhouse. We have 3 products to aid with mine planning, Micromine Alastria, Micromine [indiscernible] and Micromine Advance. [indiscernible] is used for planning hard drug surface metal mine, iron ore, copper, gold, Pingalastri. Micromine [indiscernible] is used to plan soft commodity mining, coal, potash, phosphate. And Advance is used to plan operations in underground mines. The picture there illustrates how the user can compare multiple underground mining scenarios for the same or deposit. The scenario with 1 decline will require less initial capital than a scenario of [indiscernible] the clients, but which scenario is more profitable overall. Our software helps the mining enterprise to come up with these answers. With all the activities planned, we must monitor the execution of the plan, the ore extraction activities.

How much did we actually produce? Are we on target to meet the plan? And if not, why not? This is where we have 3 solutions: [indiscernible], Fast2Mine and Motion Metrics. Unlike any other competitor, we offer specialized solutions for underground and surface mining. Those are 2 very different mining environments. Pedron and Fast2Mine are mine control systems for monitoring recording and optimizing mining activities. Pedron focuses on underground mining. Fast to mine is a product we deploy to surface mine. The motion metric solutions are deployed in mines using AI to monitor the status and performance of the mining shovels.

The picture shows motion metrics, shovel operator screen assisting the operator to ensure the truck is not leaving underloaded or overload it. We are maximizing production while looking after the asset health. We also see Fast2Mine [indiscernible] versus [indiscernible]. With the Fast2Mine up, we take the live data, out of the mines control room and make it available to the mobile worker moving around the pit. This picture shows Pedramcontrol room screens. Underground mining equipment and even underground locations are represented on the screen with colors indicating the current operational status. Our mine control software solutions focus on helping the mines to maximize the availability and utilization of the mining assets. Lastly, our unique Nexus platform.

Nexus is Micromine's cloud-based collaboration platform, facilitating data sharing between the Micromine point solutions. Nexus provides data storage, versioning with full audit trail, and 3D visualization. Nexus Cloud is where Micromine point solution users go to source the single version of the truth for a shared data asset. To a 3D mining data user, this is a very exciting picture. Why? NEXUS user can visualize the cloud-based 3D mining data inside the browser, with each data set coming from a different point solution.

We see [indiscernible] that comes from my Micromine beyond. The ore body model came from Mycode Origin and the drilling data from the Geobank system. And all these net assets have been updated, uploaded to the Nexus cloud to be shared with the adjacent Micromine point solution as a part of the regular [indiscernible]. The Nexus cloud platform is more than a gut store for us. It's Micromine foot in the cloud. We expose new network training service via Nexus. The service is used by our customers to train their own new network models, which are then used inside Micromine origin. Nexus is also where our customers come to interact with Micromine support, where they come to manage their licenses and monitor license views.

And with that, I will hand back to Kristina.

Thank you, Ivan. Our target market is large and rapidly expanding due to increasing digitization and a recognition by mining companies that is at the core of integrated mine management. We estimate the total global addressable market for our current products to be GBP 3.8 billion. The total vended market estimated at GBP 2 billion is expected to grow by 10% per annum weighted towards the Americas and Australian gold and copper mines but applicable to all commodities and geographies. Our business has a steadily increasing global customer base with Australia being our biggest revenue generator. Roughly 30% of total revenue. And North and South America and Africa being our largest growth regions. Our revenue streams are well diversified with gold copper and iron ore representing approximately 50% of our revenue contribution. By combining Micromine Motion metrics and FastMine, we offer the most comprehensive equipment-agnostic exploration to extraction solutions.

Our products cover every segment of the value chain, and are uniquely integrated through our Nexus Cloud platform, delivering unmet online collaboration and data sharing. Competitors are generally classified into 2 main categories: original equipment manufacturers who often bundle software with their equipment and large software companies that focus on multiple end markets. Notable participants include Sequent a market leader in geology modeling and owned by U.S.-listed Bentley systems; and Sandvik owned Deswik, a market leader in mine design and mine planning software.

No competitor can match our breadth and depth of products or our best-in-class technical support and customer success program. Our software business has a growing loyal and diversified blue check customer base. To share a few examples. Micromine helped First Quantum Minerals Tile Mine, 1 of Turkey's largest underground copper and zinc mines increased productivity by 18%. And facing depleted reserves, rising costs and the complexity of managing 2 ore bodies, the mine needed a more agile, data-driven approach, by implementing Pit REMS, real-time mine control and fleet management system, including a 24/7 control room integration with SAP and mobile access. The site transformed planning and execution. Shift coordinators gained live visibility, enabling faster data-backed decisions and automated reporting. The results are streamlined operations, optimized resource allocation and an 18% improvement in productivity and production.

At Barrick Mining's Veladero Gold mine in Argentina, Micromine helped cut mine planning generation time by 40%. The challenges were complex haulage networks inconsistent workflows and the need for a user-friendly system. Micromine's [indiscernible] solution delivered an integrated platform with modular tools, in-force workflows and 3D visualization for real-time data validation. The Veladero team built a digital twin of the haulage network, enabling accurate cycle modeling and scenario testing. Implementation was fast just 4 months. last re-enabled streamlined planning, reduced errors and more time for engineers to focus on field leadership, setting a new benchmark for efficiency.

These case studies illustrate the typical short payback period that our customers experience. Each of our 3 businesses have unique growth strategies and each a strong right to win. Common growth themes include market penetration, geographic expansion and product expansion opportunities. For Micromine, the [indiscernible] hard rock mining planning product is used at all the major miners in Australia. We are using our track record with customers in Australia to secure new customers in the Americas and Amy, which is Africa, Middle East and Europe. In Motion Metrics, we are creating the market enabling customers to see parts of their operation that have traditionally been unsafe to access. As enterprise customers realize the productivity benefits of Motion metrics, there becomes a driver within those organizations to roll out Motion Metrics technology across their mobile fleet. And finally, Faster mine has been highly successful targeting Tier 2 mining companies in Brazil with their mine control solution. And as the technical feature set has gotten richer, they are now positioned to consolidate from a Tier 2 provider to win with the Tier 1s.

By leveraging Weir and Micromine's footprint, Fast2Mine has untapped growth potential globally and is initially targeting its international expansion to Chile and Africa. And pleasingly, this year, they have secured wins in both regions. Through our sales process engagement with customers, we aim to demonstrate measurable and compelling productivity gains and then follow this up with strong implementation support and customer success programs. This helps explain Micro mine's customer retention rate of 93%. When we talk about our strong minerals and aftermarket model having parallels with software, we are referring to our subscription model, which generates recurring revenue. The key growth metric in software businesses is annual recurring revenue, or ARR.

As of September 2025, Micromines, recurring revenue as a percent of total revenue was 87%. Since 2022, Micromine's average ARR growth has been 25%, and we anticipate this rate being maintained or exceeded underwear's ownership. Now Motion metric is going to transition from one-off perpetual licensing model to a subscription-based licensing model in 2026 to allow to generate stronger recurring revenue. As we transition, we expect a very high ARR growth rate in 2026. And then all of these metrics, we expect to be similar to Micromine from 2027 onwards. Weir's global customer base presents a compelling opportunity to access and grow our software business with existing minerals and ESCO customers. We've developed and implemented a regional program to maximize the opportunity over the coming years and early signs have been very encouraging.

This initiative identifies our largest opportunities for growth within our software businesses and leverages the local relationships of our Minerals and ESCO team members to facilitate warm introductions to Micromine colleagues. In 2025 and for the next 2 years, we will invest additional head count and additional head count to scale the software business, adding to our sales, customer-facing roles to ensure that we're ready for growth. While it's still early days, we believe this program will both improve the quality of leads and reduce lead-to-sale conversion times. To share an example, within just 2 weeks of launching our pilot program in July, we arranged meetings with 4 different mine sites operated by a Tier 1 iron ore miner. Since then, we've met with various customer stakeholders at both mine site and enterprise level and initiated 3 pilots featuring 2 different Micromine products. We're pleased to report that this resulted in our first sale with this strategic customer.

To share another example, this time, a cross-selling opportunity within our software business, Motion Metrics was recently awarded a truck metric subscription by a Tier 1 gold miner in Australia, successfully replacing a competitor through integration with [indiscernible] to monitor fleet movement and measure material volumes. Additionally, the site team from the same company's African operations reached out to inquire about implementing a similar solution. These examples are early wins, and they are indicative of the tremendous growth opportunity in leveraging our wear footprint and our customer relationships.

As a leading mining technology business, we are acutely aware of how organizational culture drives our success. To ensure Micromine and its unique tech culture endures, we have established our Software Solutions business as a standalone operating company within Weir, ensuring the agility scalability and growth expected in a SaaS and tech-driven environment. This structure aims to enable the best of both businesses. sharing we are significant resources, global footprint, deep customer relationships and mining-focused expertise while maintaining a clear focus on nurturing a software-first culture agile development practices and software growth metrics. We've used the twice yearly Micromine employee survey to measure employee engagement post acquisition.

The first survey was conducted in May and the second survey closed last Friday at the 7-month mark. With strong participation, the employee engagement score stands at 77% and on par with the highest score since May 2021 and in the top quartile of the Newtek benchmark for companies creating digital technology and employing less than 500 people. We continue to lead the sector with an employee retention rate of 90% with the attrition rate falling since acquisition.

These figures reflect our ongoing commitment to fostering a collaborative, inclusive and high-performing work environment. In summary, our vision is to lead the industry and next-generation technology for mining. With the broadest suite of market-leading equipment-agnostic software solutions a team of capable geologists, mining engineers and developers, feature-rich, best-in-class products and a relentless focus on creating value for our customers. And finally, a global footprint backed by Weir. We are well positioned to deliver growth and are very excited about our journey ahead. Before we go into an opportunity for Q&A, I'd like to finish with a short video from our first Micromine Africa, Europe and Middle East user conference held in Johannesburg 2 weeks ago.

The conference was attended by 37 customers from around the region and was a great opportunity to share how our solutions drive customer value.

[Presentation]

I hope this presentation and the video helps you understand why we are so excited about this opportunity. And I'd now like to invite Jon back to the stage for us to take questions.

Okay. software-related questions, please. We're going to have another Q&A session later on everything else, but this is all about software. Lash?

Andrew from Jefferies. So I'll pass Three questions, please, if I may. The 50% of revenue that's not gold, copper and iron ore, I'm assuming that's coal, given your Australian heritage or is that not correct? .

It's very much a mix of all commodities on the bottom of the tail.

Fine. And in terms of the investments in people, as you're scaling this globally, which comes first, the investment or the revenue. So do you have to put people in to grow this business at 25% for the next 10 years? And then the more you grow, the more people you put in? Or is it the way around that you have to kind of wait and scale up. So as your sales come through, you can then afford to put more people in. How do you think about that expansion and looking after the P&L in the near term? .

We are -- we have a head count that we're adding as we speak. We've been ramping up people. And as you know, the business has been scaling. So we're seeing -- we're doing both at the same time.

But balancing it, Andy. Yes. So it's like the business -- the existing business has a model of adding heads in line with revenue growth. We're adding more because we want more growth. We need to add the cost a little bit earlier and we get the revenue, but we're obviously balancing that so we don't get ahead of ourselves one way or the other.

Perfect. And then last thing. Clearly, this has been a really good growth story as a kind of private business. You're joining where you've got massive opportunity to take us everywhere globally. Do you change your kind of route to market as it were in terms of the people you're speaking to. So for example, if you are previously selling to, I think you work Explorers and mine pit specialists. Do you now go further up the food chain to the executive of Anglo, or do you have a different conversation with your customers, which basically will allow you to drive faster growth or maintain that higher growth at a higher level?

So we -- the businesses have been traditionally sounding very product focused. And when I talked about the being #1 in point solutions, we're and mentioned many times, geologists and mining engineers, we have been traditionally selling to those individual personas. What we are finding immediate [indiscernible] we need to be able to talk about the whole portfolio.

That's what the -- we are customers traditionally are used to like tell me everything that you're doing and what the opportunity is. So we see ourselves layering. We want to maintain that very credible depth of product knowledge and layer that with the enterprise ability [indiscernible] pain point, and we will get in with a customer. And then from that point, it's very, very easy because of the great customer experience that our customers have with Micromine to go up or down the value chain.

Yes. But just to add to that, I think there's a couple of things to say. First of all, we think there is an opportunity -- there's a massive opportunity to keep doing what Christian just said in terms of point solutions to geologists and mine panels and so on. But one of the things that we see across the industry is that the big miners have software proliferation and headaches all over the place in terms of massive diversity of products across all of their sites, which drives problems in terms of licensing, procurement, so on and so forth. So they've got a headache about how do we make this simpler? How do we streamline, how do we consolidate our suppliers in software as we have done in some of the equipment space as well.

So there's a driver there of that enterprise sale happening at our customers today, and we want to tap into that alongside maintaining the absolute credibility with the local level personas as well. So as Kristian said, is going to be multilayered.

Its Lush Mahendrarajah from JPMorgan. I guess the first question is just on you talked about the vended market and the white space market. Just maybe a bit of color on what the difference is between the 2. And it sounds like you're targeting more the vendor market, I guess, just why that specifically?

Okay. So if we break that down again, so $3.8 billion of total addressable market. So I think [indiscernible] first $3.2 billion. And then within that [indiscernible] is a competitor product or a competitor in that space for all the core capabilities that we offer through our software. Then when we think about where -- what our strategy is, all 3 of the businesses are in slightly different spaces. So Micromine being a very mature business with a Tier 1 set of products is operating predominantly in the vended space. So it's well known. It's very mature markets, and we're operating in the vended space, and we've told you the reasons why we have a right to win in that space. When we think about the Motion Metrics products, in most cases, Motion Metrics is operating in a white space. So there isn't an existing product. And in most times, we are presenting the technology as a new technology that customers have never seen or experienced. So that's white space. When we think about Fastermind, it's actually right on the border line because what it's doing in the Tier 2 space is it's all white space for it. And it will continue to win in the white space of Tier 2. But as it's now maturing, it's starting to be able to compete and contest in the vended space, and we'll see it do both of those.

Okay. And the second question is just on the growth rates. I think you talked about the vended business market growing 10% per annum. Obviously, [ CEO ] businesses you expect to outgrow, but what's the sort of underlying assumption that 10%? Are you assuming an OEC per cycle within that? And I guess how would that change those assumptions? .

No, we're not assuming a super cycle in that. That is what the market has historically grown which is through the Momentum program that we talked about. So that's a well understood and expected sort of overarching growth figure for the market.

Jonathan?

It's Jonathan from Barclays. Just 1 question, please. I think in your slides, you talk about 20% to 30% growth from Micromine. If we kind of look at the deal metrics or to make the deal work for Micromine, does that growth have to be faster? And if it does, how are you going to deliver that?

Yes. Well, I think that 20% to 30% we talked about is sort of the blended rate for all 3 of those software businesses that are coming together, and we'll see different rates within those businesses. For the core Micromine business, we said at the time of the deal, this has grown at 25%. Under wear ownership, we will grow it at at least 25%, probably higher than that, and that's what drives the deal metrics. Motion metrics, given some of the market dynamics you talked about will probably grown at a slightly lower rate once we've done the conversion from upfront perpetual licenses to subscription. And then through the long-term cycle, that combined business should be capable of growing at 20%, 30%, so hence, that range. But that core Micromine is 25% plus. And I know Kristen is very focused on that.

It's Stefan Tarom BNP Pariba. Just I'm very boring here. I'm just having a follow-up question on the 20% to 30%. Can we break that as well? That's a price component in that? It has to be, yes. And if you look at the 25% growth of the past, how much was the pricing component in the past, what you're modeling in the future? And what kind of duration of growth are you saying? So are you going to say you're going to grow the 20% to 30%? Is it -- are we talking 3 years? Are we talking 5 years? Are we talking 2 years? What's basically the phasing what you see here with the growth?

Yes. Well, the core Micromine business that our acquisition criteria is to deliver -- our weighted average cost of capital in the third year. We got to deliver that level of growth to enable that. So that's the focus. We think beyond that, we should be able to keep the growth rates enduring at that kind of level. But for the deal model, it was critical in the first 3 years that we highlighted that. And given the historic growth track record of Micromine plus all the benefits of now leveraging the wheel network, which we're early days. We've got some great encouraging signs of success. That's why we feel particularly good at that. In terms of pricing, historically, the business has probably done high single-digit pricing each year. And the rest is the software equipment, the volume share growth.

[indiscernible]

Back to Andy.

You talked in your presentation, John, about compounding M&A., which might surprise 1 to you people see you just put a lot of money on software. How do we think about future M&A? Are these things that you need to buy to have a full service proposition from the geologist down into the pit that you need that you've got gaps now? Or are these kind of nice to have, which means that your market position from a software perspective, which is already strong, kind of get stronger or maybe even act as a defensive mechanism to stop your peers I'm thinking about M&A and that thought process. And if you have must buys, are you prepared to push that net debt. .

The pipeline in terms of how we're thinking about that specifically for that business. But stepping above that, my comment was about all of Weir. And just as we see opportunities, which Kristian will talk about in terms of software and digital capability to enhance what we've got today and accelerate our strategy, we continue to see opportunities other geographic infills of product extensions, new technologies to supplement what we're doing in ESCO and Minerals on the hardware and equipment side. including digital, which [indiscernible] will talk about a couple of examples that we've done really, really small deals there to bring some AI capability to minerals. So we're very, very focused on those 3 buckets. And as I said, in 2025 after a relatively quiet couple of years where I would say we've been very, very disciplined in deciding what we -- particularly what we didn't want to buy waiting for the right things to come along. Of course, we had a very busy year in 2025, where the things that we've been waiting for came to fruition.

And we expect to continue in that vein of bolt-ons. We should generate as we move forward, $250 million, $300 million of free cash a year. Priority A, we think there's a big enough pipeline of M&A timing and so on and so forth, but that is our intent.

Yes. The very short answer to one of your questions was, no, there's nothing that we must do in the space that we are dominating and want to continue to dominate. I'll say it for the third time, I'm sure, but we're super excited about how the Fasterminde product fits so well into the portfolio. So really, we see the ability now with bringing the businesses together to integrate a wonderful opportunity just to have domain expertise across exploration to extraction. The really kind of very cool part is we are having a lot of opportunities come to us. We have a lot of integration work that we're working on and just huge opportunities to respond to customers that we haven't spoken to before now that we're part of -- we have access to every mine site in the world through the Weir footprint. So I think what we're planning to -- what we are currently doing is we're really being disciplined around thinking through all the opportunities that are coming to us, putting together a very disciplined prioritized playbook about what's going to make sense, but we're really thinking about that for 2027 and beyond because right now, we just want to get disciplined about the thinking, the quality of the thinking that will go into what bolt-ons are going to make sense with a great, great pipeline coming to us.

So there was a question at the back, and then we're running behind a bit, so we need to break up to that one, if that's okay.

It's Rory from Watsco. I'm at the back, so it was a little bit late, apologies for that. My question is on margin -- software margins. I think you mentioned motion metrics shifting from a perpetual license to a SaaS model. Just wondered if there are any sort of margin dynamics to think about there. .

Yes. I think that what we've seen and learned through all of the efforts that we've put into the Micromine business is just what a great model it is. And we see a similar model in fast mind, it's a full subscription business. And that really gives us confidence about what we can do with the MotorMetrics business. Motion Metrics has been on a journey to convert to subscription. And that journey has been going really well. And some regions within wear have adopted subscription more quickly than others. But now with the capability and experience of the Micromine and Fast2Mine team, we feel very confident that we can put the right plan in place to move our customers and move our new business into subscription, and that certainly comes with the scaling factor of the recurring revenue.

Great. We now have a 20-minute break, sorry. We need to let people experience the presentations demos outside. And so back in 20 minutes, please.

[Break]

Well, good afternoon, everyone. My name is Shan Fitzgerald. I have the honor to lead Weir's ESCO division. ESCO is a 112-year-old division headquartered in the United States, and we've been a proud part of Weir since 2018. We are the global leader in mining and infrastructure ground and gating tools, attachments and wear parts with a team of over 2,500 people operating and serving our customers in more than 90 countries across 6 continents. Since joining Weir in 2018, ESCO has operationalized Weir's relentless focus on performance excellence, particularly in capacity optimization and continuous improvement of our lean processes to ensure we are always ready to serve our customers. In addition to allowing us to better serve our customers, performance excellence has enabled us to invest in what sets ESCO apart, the unbeatable combination of best-in-class technology, coupled with the customer intimacy from our go-direct strategy. All this improvement has been underpinned with Weir's march towards zero harm. In fact, ESCO's total incident rate is less than half what it was when we joined the Weir family. As we look forward, our focus is on utilizing the operational leverage that performance excellence has provided to accelerate growth.

We are launching multiple new products, which I'll speak about in more detail in a minute. And we plan to further grow our go direct presence, which I will also touch on. The formula remains constant, best-in-class technology, coupled with customer intimacy. A mine is a complex operation, and each one is unique. Therefore, to operate safely and efficiently, the best mines have great supplier partners. By going direct to our customers, we understand our customers' challenges and can apply our technology to optimize their operation. Simply put, we offer our customers a commitment. We provide the best technology, and we are always ready to serve. Your operation will never stop because of ESCO. That kind of commitment is one of the reasons why we invest in our global operations of foundries and customer service capabilities. I want to just briefly touch on this as it is our operational network that forms a key component of our foundation for growth. ESCO is unique in our space and that we maintain tight control of our proprietary product designs.

This not only ensures we have complete control of our service to our customers from design to delivery, but also ensures that our products are made to our high-quality standards and our intellectual property is protected throughout the process. Some of you were here 2 years ago at our last Capital Markets Day. At that time, I was committing ESCO to key operational milestones such as the opening of our newest foundry in Suzhou, China and key performance improvements across our network. In short, we met or exceeded all our commitments. We made significant improvements across our entire network in safety, quality and cost. And we did this while opening our newest foundry ahead of schedule, under budget and exceeding our planned performance in both tons produced and cost. Our global foundry network and customer service operations ensure we produce quality product at a competitive cost for every market. As I mentioned earlier, our network enables us to always have product ready to serve our customers anywhere in the world despite any macro shocks or trade disruptions, which I think we can all agree have been constant the past several years. Most importantly, our operations network provides a foundation for growth. By operating our own foundry network, we can develop and launch industry-leading technology and ensure our intellectual property is protected.

I think the best way to illustrate this is with an example of our latest product launch, Nexus. Now before I dive too deep into Nexus, I think it's important to distinguish something. When Kristen was up here, she was talking about Nexus, NEXUS. That was Kristian's version of Nexus, if you will. For ESCO, Nexus NEX-SYS. -- and we're not trying to confuse anybody, but obviously, great mines think alike. We are the undisputed leader in mining ground engaging tools, and Nexus is our latest mining GET technology and a step function change for the industry. We have a long legacy of leading in GET. We introduced the Whistler Plus and Nemisys systems, which have become the industry standard in performance and reliability. Nexus builds on this legacy by providing longer wear life, reduced maintenance and improved safety for our customers. Simply put, we set out to make the best even better. We worked with customers to understand their pain points and then apply technology to further reduce their total cost of ownership. We launched Nexus for cable shovels in late 2024 after 3-plus years and over 15,000 hours of field trials across multiple sites, continents and applications. We know what it can do and customers are responding. Dozens of customers have already switched to this system, including every single trial site customer.

The photo on the screen is from a mine in Northern Brazil I visited recently and heard firsthand from the customer the value Nexus offers. This is one of our trial sites and the customer has already committed to multiple systems for their fleet. Nexus will soon be expanded to our hydraulic shovel offering. We currently have components of Nexus for hydraulic shovels being tested at customer sites with a full launch scheduled for 2027. The step function value improvement of Nexus over legacy systems ensures that we will maintain our industry-leading position as it becomes a key driver for our growth. Nexus is just one of the many products that across both the mining and infrastructure segments. We plan to launch multiple new products across these segments in the next several years, which allow us to maintain our industry-leading total cost of ownership across the portfolio. I already mentioned Nexus, which is now deploying with cable shovels, but will soon be available across every major digging machine platform. ESCO GET is used on nearly half of these major diggers and growing as we track and pursue every single machine in the market. Capital buckets continue to be a strong growth segment for us as we use our technology leadership to further move along the customers' value chain and grow from our current 10% share position.

We have grown rapidly in buckets for cable shovels with our production master system. In a minute, I'll highlight how we have now applied this technology to hydraulic shovels in order to further expand in new markets. With respect to infrastructure, in early 2026, we will launch Vertisys. Like Nexus, Vertisys builds on ESCO's already industry-leading construction GET platform. Again, the best is now better. Vertisys has been undergoing extensive field validation, which has proven its superior performance by further extending wear life and providing safer and easier maintenance to our customers. All these products have several things in common. They are designed by our world-class engineering and metallurgy teams. They undergo extensive field testing and validation to ensure performance. They are manufactured in-house to ensure quality and IP protection, and they're agnostic to the OEM and the major bigger on which they're employed, which allows our products to maximize the addressable market, which comprises over 90% of our revenue. These products not only ensure we will maintain our industry-leading position, but allow us to further grow with technology and customer intimacy.

A great example of this is our recently and offers a great opportunity for growth. While ESCO is the leader in the Australian mining GET market, we have opportunity to further grow along our customers' value chain by growing in buckets, especially hydraulic buckets. We sat down with our customers to thoroughly understand their pain points. These challenges included inefficient bucket loads, also known as pass matching with their truck fleet and significant wear leading to additional maintenance. We then applied our technical knowledge and design capabilities to purpose design a new hydraulic shovel bucket that can be easily customized for our customers' unique applications and challenges. The results have been phenomenal. Our design is lighter, allowing for greater loads with each dig, thus improving pass matching. And our design is more robust in the key areas of wear, which allow our customers to lengthen their maintenance cycles. And when matched with Weir's digital capabilities like Motion Metrics, our customers can see the improvement for themselves. All this has led to incredible growth in this key market. In the past 2 years, we have grown our Australian bucket business 7x with a lot of opportunity in front of us. And remember, every one of our buckets comes with ESCO's proprietary GET system. We have plans to expand in every region, but one of the most exciting new opportunities for us is our plans to go direct in the Chilean market. Chile is the world's largest copper mining market and the fourth largest mining market overall.

Since 2007, ESCO has been in a joint venture with a local partner, which has acted as our commercial dealer in Chile. While it's been a successful JV, we know we can be even more successful in this critical market if we go direct to our customers. We know this because of the greater success we have throughout the rest of South America. Therefore, ESCO plans to go direct in Chile no later than the second half of 2027. This is a great opportunity for us to apply our best-in-class technology like our new Nexus system directly to our Chilean customers. We have been playing this for quite some time and are ready to serve the Chilean market. In addition, our sister division, Minerals has always been going direct in Chile and already has a strong commercial and operational presence that we can leverage to expand quickly in this market. In fact, we are working closely with Minerals and software solutions on many growth opportunities. Together, the Weir divisions provide a compelling solution for our customers. In summary, ESCO is an industry leader that is aggressively accelerating growth with new products and geographically.

We have a global network that can serve our customers despite macro disruptions while protecting our intellectual property by manufacturing in-house safely with quality and at the right cost position. Our strategy remains constant. We provide the unbeatable combination of best-in-class technology with unmatched customer intimacy to apply that technology that can only come from our go direct presence. Now I'd like to turn the presentation who will provide more detail on that division's great growth opportunities. Thank you.

Okay. Thank you, Sean, and good afternoon, everyone. I'm pleased to walk you through how Minerals is evolving from a product-centric business into a digitally enabled broader solutions provider, driving sustainable growth and giving me the confidence we can continue to grow aftermarket revenues at mid- to upper single digits as we have done consistently over the past decade. Over the past few years, we've streamlined our business, adopted lean practices, invested in best-in-class systems and refined our operating model will scale. For example, our continuous improvement program wins and quality processes adopted from automotive industry, which has delivered an annual reduction of over GBP 3 million in cost of pure quality alone. We have closed or reconfigured over a dozen sites and service centers, ensuring we have the right capacity and capabilities where we need it. And this will support over GBP 30 million in capacity optimization benefits in 2026. We've invested some of these benefits to support expanding our product and digital offering, increasing research and development while still expecting to deliver around 400 basis points of margin improvement. We're accelerating our evolution towards solution selling, combining products in our portfolio to offer unique solutions to our customers using digital insights to provide further differentiation. We've adopted best practice strategic account management processes to engage with our customers earlier in the process and get a larger share of wallet. And we're expanding our expertise in minerals processing, not just discrete products, alongside investing in disruptive technologies to deliver step changes in mine productivity.

And none of this will take our eye off accelerating our continuous improvement journey, and we will leverage AI and investments in new technologies to ensure our manufacturing supply chain costs are optimized. And this includes investing where we see the potential to accelerate our journey to zero harm. I'm a big believer that a lean plant is a safe plant and zero harm is embedded in our philosophy across the business. I'd now like to share a video with you that takes you on our growth journey and illustrates the strength and breadth of our products and services today. -- so as you can see, we've expanded our offering beyond pumps, the focus when I joined Weir 16 years ago to encompass the full minerals processing flow sheet, comminution, separation and tailings. And this positions Weir to support both greenfield and brownfield projects, delivering efficiency, sustainability and scalability. Our extensive service center footprint ensures proximity to customers and reinforces our commitment to long-term partnerships. And by expanding our flow sheet in this way, we've grown our addressable market around 3x since 2010. While we remain focused on our core pump business, where we continue to be the clear market leader, our product line expansions mean we now have a much larger addressable market and products where we currently have a lower market share and our range of best-in-class technologies. Our unrivaled local relationships enable us to leverage this broader product portfolio, and we're always innovating to help mine operators increase capacity, improve productivity and respond to changing conditions. And this means that sometimes we're creating our own capital markets, proactively identifying ways to reduce customer costs and increase production. Examples range from pebble crushing with small HPGRs or crushers combined with screens, upgrading cyclones through our new CVD range, which offers a 2% increase in recoveries or extending operating intervals between shutdowns with our latest pump upgrades and reducing tailing transport energy requirements with new copper plant. original equipment may cost from GBP 60 million to GBP 125 million with annual aftermarket potential of up to GBP 40 million each and every year.

This underpins our resilience over those years with Minerals aftermarket growing almost 80% over the past decade. And in 2026, we will launch our first internally developed vertical sterd mill. This fills a gap in our prior offering, displacing the need for ball mills by offering materially lower energy costs, footprint and recirculating load. Having recruited the top mines in the industry, we're confident our sterd mill will be the best in the market and will augment our industry-leading HPGR product. We've also been evolving our downstream offering by partnering with innovative technology leaders in coarse particle separation, which further reduces the level of recirculation in a processing circuit and improves recovery levels. Our investment in P29 technology with Sidra is an example of this. We were taking a stake in helping develop the potential next step change technology in minerals processing. The GBP 53 million win at Barrel Reko Diq is a great example of this broader mill circuit offering in action on a greenfield development. It shows that expanding our flow sheet and investing in new technology was a wise choice. A decade ago, without our comminution offering, we couldn't have competed for such a project. Our deep customer relationships at all levels ensured our early involvement, demonstrating our flow sheet was 25% more inefficient than the alternatives, leading to the customer selecting an HPGR-based circuit. From this base, we sold a range of screens, pumps, cyclones and other products as part of an overall package solution from mill circuit through tailings. And this site will be a showcase for future customers, and we're already attracting interest.

With an on-site service center being built, we will support aftermarket across this range of products and our relationship also ensured ESCO GET will be first-fit at the mine and supported from the same service center. Turning to our core slurry pump product line. We continue to develop our offering, pushing the boundies of slurry pumping and using new technologies to extend our market leadership in a major brownfield expansion. The MCR 760 ordered HVC demonstrates the combination of our digital and core product strength. This is the largest slurry pump in the world with no competitor having a similar-sized installation. We built our relationship on the existing concentrator around other installed products.

The customer wanted higher output and less downtime, relying on next intelligent monitoring retrofitted to their cyclones for improved throughput. And support from our Kamloop service center was instrumental in facilitating this partnership, strengthening our operational capacity and positioning us for continued growth. And as a result, we have dislodged a long-established competitor who had the original mill circuit pumps. Highland Valley Copper also proceeded with a weird dewatering barge and high-efficiency tailings pumps, enhancing water recovery, reducing operating costs and supporting sustainable mine life extension. And we're not just focused on the concentrator. Addressing tailings is an important opportunity driven by factors like extended mine life, freshwater usage and increasing tailing management regulations. Our products offer unique solutions for customers. Regulatory pressure is intensifying worldwide. wet tailing dams are no longer acceptable. Operators must adopt thickened or dry stacking methods to maintain their license to operate. Our strategy to address this is clear. don't waste on waste. Traditional filter presses are expensive to buy, install and run. The require large footprints and are energy and maintenance intensive.

Instead, we focus on smarter approaches like hydraulic dewatering and near dry stacking, which delivers faster, more efficient outcomes. And this matters because every mine faces 1 or 2 constraints, either tailings space is limited or water is a scarce resource. Our technologies include GiHo for high-pressure hydro transport, [indiscernible] cyclones for recovering coarse particles and engine on screens for dewatering, helping customers overcome these constraints. At Codelco Talersllabre in Chile, we secured a GBP 40 million tailings transportation order for our GiHo and warmin pumps, the largest single order for GiHo pumps to date. These pumps will reliably transport tailings thicken up to around 70% solids over long distances, supporting the development of a new tailings pond that will extend the productive life of 3 major mines, [indiscernible] reducing water consumption and waste is critical for maintaining a license to operate globally and Chile is no exception. Chilean regulations now mandate higher solids content and tailings with a minimum of 50% solids to improve stability and reduce water loss. The scale and efficiency of this project is unmatched, transporting over 10,000 dry tonnes per hour while using less energy than alternative technologies.

It delivers significant water recovery. Another major mining in Latin America and Mexico, a long-standing customer faced a critical challenge, a tailings facility nearing capacity and escalating water consumption, threatening the mine's license to operate. Our team partnered with the customer to deliver breakthrough, a dynamic filtration process for near dry stacking. This solution integrates advanced new technologies, CabEx cyclones, engine on dewatering screens, warming pumps and next intelligent monitoring to achieve solid content of up to 75%. The result was a compact, efficient system that dramatically reduces water usage and tailings volumes. And the impact has been transformative, 35% freshwater savings, 67% reduction in tailings volumes, eliminating the need for a new tailings dam and adding 15 years to the mine life, all while improving compliance and reducing environmental risk. Financially, this process innovation delivered a GBP 7 million purchase order and was followed last month by an additional GBP 6 million order from another Mexican mine. And we're leveraging this reference site wider to create a pipeline of opportunities, again, creating our own market and doing so. These projects deepen our customer relationships, drive recurring revenue and reinforce our commitment to sustainability, all key pillars of Weir's equity case. Now Ole Nilsen, our Senior Director of Digital, will provide further information about NEXT and how this will provide both a further competitive advantage around our products as well as generating revenue in its own right. Over to you, Ole.

Thank you, Andrew, and good afternoon, everyone. I'm Ulf Knudsen, Senior Director of Digital in the Minerals division. I've had almost 20 years in the mining industry, spent a long stretch with another major mining OEM. More recently, I've been had the privilege of being involved in the Micromine acquisition. That's a move I'm really excited about because I'm sure that we will together be unlocking a lot of new possibilities for our customers and for the industry. But that digital solutions and the services can generate a new direct revenue stream on its own. Within the Minerals division, it is our NEXT intelligent platform that drives the digital transformation. And we do that through tailored solutions for our core business products and services. For our customers, NEXT delivers lower total cost of ownership at the equipment level and at production level, it delivers increased throughput as well as sustainable benefits from reduced energy and water use per tonne. NEXT creates a distinct customer offering that builds customer lock-in. And at the same time, the predictive models will about unlocking opportunities for innovative business models such as Equipment as a Service, leasing and performance-based offerings. And that's a shift that will allow us to move from one-off equipment sales to sustainable recurring revenue streams. Over the past 3 years, we've successfully onboarded more than 110 customer sites and 800 assets. And I think that's a clear proof point of the massive market opportunity ahead, both within our existing installed base and through new equipment sales. So what is our next platform in simple terms? It's a platform that gives our customers and our internal service teams, clear visibility into equipment health and process health and performance. Furthermore, it enables optimized maintenance scheduling and process optimization through AI-powered solutions. When we built the foundation for the platform back in 2021, we had an equipment focused approach. But we quickly expanded to a solution focus that allows our intelligent equipment working efficiently in tandem, that gives quite a few advantages in terms of process efficiency.

Fast has always been essential to move beyond point solutions that only address stand-alone challenges. Instead, we have built an integrated platform that holistically benefits from our OEM advantage, and that's from design and engineering and years of operating data to our local service capabilities.

NEXT stands out by offering actionable recommendations enhanced with AI and OEM expertise. Our customers, they connect on these recommendations themselves or if they have service agreements, our boots on the ground will help handling the required actions. AI capabilities are a key priority, which is why we in 2023, acquired Senshin AI, a Swedish company specialized in process optimization through AI. And this year, we partnered with Viking analytics to leverage their AI-driven predictive maintenance solutions. Both these capabilities are now fully integrated into our next platform as 2 of the key differentiators. As we advance our offerings towards intelligent automation and autonomous operations, we're seeing a fundamental shift in how we engage with our customers.

Digital and data are creating a single source of truth an aligned decision-making platform that transforms our relationship from a traditional supplier status in true partnerships. We are uniquely positioned to deliver capabilities and value to go far beyond the monitoring solutions available in the market today. An example here is the Warman pump where I want to highlight just a couple of the features that are unique to us as the OEM. The first is performance managing. That's a feature that drives an energy and production efficient agenda. So we provide real-time visibility into how well the pump is operating on its performance curve.

And that's only possible because our platform has proprietary pump models embedded. The second is integrated wear sensing. Our wear sensors are built directly into the physical design of the equipment and by that, enabling continuous accurate measurement of component health, both these capabilities enable preventive and AI [indiscernible] service options where we support our customers in planning maintenance at exactly the right time.

And of course, [indiscernible] spares delivered and installed in time. So what's in it for our customers? They avoid costly unplanned downtime. They reduce maintenance costs and they improved throughput. As highlighted here, not having early fault detection and prevention of unplanned stoppages can be very expensive. For a large copper or gold operation downtime of a pump like this can cost up to $150,000 per hour in lost production.

We just look at the Warman pump but we are, of course, rapidly scaling these capabilities across our entire equipment portfolio. I'll now share 2 examples of how our digital solutions deliver real operational benefits for customers and is also 2 examples of how NEXT is fueling growth for us. One is a new direct revenue stream coming from digital and the other is about uplifting our traditional core business. Start intervention when we becomes critical.

And by that, we are driving proactive maintenance planning and ensuring timely stock availability. For our customers, the result is reduce critical downtime and improved maintenance planning for us. This unique and fully integrated digital solution has delivered an annual uplift of 10 million in sales across Latin America. So this case here clearly shows how digital empowerment drives sustained business growth by turning differentiation and actionable insights into top line impact. And please note that this case is just for 1 digital digital solution in 1 region only.

So of course, we're scaling this globally. So the second case where our solutions and services are generating direct revenue. This case is from the Middle East, where our customer was battling with ongoing failures in the PD pumps. They had a standard monitoring system already, but what they didn't have was this expert-driven context to add to the data they got. So that they came to us to see where to be with our OEM expertise, combined with our AI power platform could design a solution that added the needed features and expertise to address the main failure modes.

In this case, the existing pumps were not were equipment, but we have still been able to turn data into direct digital order with the potential to expand expand the OE installed base through data-driven insights. So as you can see, NEXT is already delivering measurable value in the field for our customers and for us, and I'm confident we've built a solid foundation to scale even further. So thank you, and back to you again, Andrew.

Okay. Thanks, Oli. With aftermarket growth projected at around 7% per annum [indiscernible] role in sustaining this upper single-digit growth. This is achieved and continue to grow ahead of our markets through the cycle. So in closing, our growth strategy is anchored in delivering mission-critical solutions to keep customers operating at peak performance. We've built a targeted portfolio of digital tools designed to minimize downtime and maximize throughput strengthening our minerals core and accelerating aftermarket opportunities 1 field and greenfield projects.

I'll now hand you over to Brian, who will take you through an update on performance excellence.

Thank you, Andrew, and good afternoon, everyone. As John mentioned at the start of today, we are committed to delivering operating profit margin sustainably above 20% from 2026. This has been driven by many factors, but a key to this was the success of our Performance Excellence program. As we enter the final year of the program, we are well on track to deliver our commitment of GBP 80 million of cumulative savings. Although the formal program nears completion, we will continue to drive efficiencies across our business, transitioning from performance excellence to driving continuous improvement.

As an organization, we have built the lean operations muscle, allowing us to drive and optimize customer fulfillment through clean and agile operations. Over the past 3 years, we have shuttered or reconfigured operations across our higher-cost locations and consolidated these into lower-cost geographies, which are also closer to our customers. This will provide us with an enduring operating margin benefit over time. In addition to our lean journey, we are leveraging technology to deliver high-quality, efficient business processes through global business services.

Combined, we expect these initiatives to contribute 75% of our total Performance Excellence run rate savings in 2026. While Performance Excellence as a program is coming to a close, we will continue to develop this muscle, which puts more control in our hands to further grow margins and manage headwinds such as revenue mix or future OpEx investments, which will inevitably impact our business. Through these initiatives, we are committed to our goal of maintaining best-in-class operating margins and cash conversion in our industry. When fully embedded, through our organization, the lean mindset is a very powerful tool for continuous improvement.

Part of Lean's power comes from the simplicity of its principles and the ability to be repeated over and over compounding operational benefits over time. Through Performance Excellence, we embedded the wins in CI frameworks across our operations in Minerals and ESCO divisions. The benefit of these frameworks are clear. We have seen lead times between requests and delivery of customer quotes reduced with increased on-time delivery. The team has driven first pass quality improvements while also in reducing stranded inventory. These outcomes are both critical to our margin improvement and cash management strategies. But most of all, improvements in these key delivery metrics drive customer satisfaction, further differentiating wear our level of service and customer care from the competition.

A guiding principle of our Performance Excellence program is to deliver improved margins while maintaining the high level of frontline interactions our customers expect and want from where. With this principle in mind, we have developed and deployed a bespoke shared service model, we call Wear Business Services or WBS. As we further invest in our IT infrastructure, the power and capabilities of WBS will in kind expand.

It will expand our offering to our business and provide the flexibility to react to customer and market demand without increasing our overheads. Over time, we expect to continue our drop-through trajectory by decoupling growth in the businesses from SG&A expense. While individually, our businesses are subject to distinctive profitability levers as a whole, they benefit from the operating leverage inherent in the aftermarket-focused business models, combined with continuous improvement initiatives. So starting with Minerals, where we expect to deliver low to mid-20% operating margins through the cycle, fluctuating predominantly due to annual changes in original equipment and aftermarket mix. We similarly expect ESCO to deliver low 20% operating margins, subject to annual changes between product lines.

And finally, over the midterm, we expect our Software Solutions business to deliver mid-40% margins and beyond as the business high growth rate drives scale from our initial investments in people and in infrastructure. In summary, through portfolio optimization and a clear vision to generate resilient and predictable returns, we have built 3 fantastic businesses which, over the long term, we expect to deliver industry-leading operating margins sustainably above that 20%.

With that, I would like to hand back to John for his closing remarks.

Thank you very much, Brian, and thank you to the rest of the speaker team. I hope the audience has found those presentations insightful and as exciting as I find them. Now as you can see, Weir is a very different business to the 1 of 10 years ago, focused just on mining, with trusted brands, leading technologies a truly differentiated customer service. We are strongly positioned to benefit from the multi-decade will enable sustainable mining. Our markets are strong. And as we grow our highly engineered mission tons with connected intelligent products. Our actions today put us on a clear path towards Mine to mill data integration, a step change in mining productivity while incrementally delivering high yields and a lower downtime. Where is a great business with a strong, scalable platform for growth. Wherever opportunities come either through large expansion projects or regulating our razor-razorblade business model means as our installed base of equipment grows, so does our recurring high-margin aftermarket revenue. Our highly complementary software solutions business adds even greater scale and profitability to this model and supports our capacity to generate strong cash flows.

And as we delever from acquisitions, we'll focus on maintaining an active M&A pipeline to further compound our strong organic growth. So together, the long-term opportunity for Weir is tremendously exciting. There is clear demand for critical metals and our customers recognize the need for new solutions to drive growth. Through our strategy, we are creating a global leader in both engineered hardware and software solutions for mining. And that combination will accelerate our resilient and predictable growth model through new solutions, geographic expansion and M&A. And finally, over the longer term, contributions from software solutions will accelerate growth towards the higher end of our through cycle guidance. And that's why I'm so confident we have a bright future ahead. So thank you for your time and attention. We're now going to have another short break with the opportunity to see some of the demos and then the executive team will return for a further Q&A section on everything you've heard today, and I look forward to that. Thank you.

[Break]

[Presentation]

All right. Welcome back, everybody. Hope you enjoyed interacting with all of the digital capability and other presentations outside. And now it's open forum for Q&A. So please far away. Jonathan [indiscernible]

Its Johnathan from Barclays. I just have 3 questions, please. First one is just on ESCO and just coming back to that sort of Chile opportunity and going direct in Chile. How is that going to operate? Is that you actually setting up your own network there? Or is that you buying the distributor? And in terms of the sort of profitability uplift from your strategy relative to what you do now, can you just give us a rough feel of how that can improve? That was the first one. The second question was just in terms of margin. and obviously the margins that target you put out there for the various businesses. I think if we take a sort of a rough mix of where we think those businesses or those product lines can be, it kind of gives you a margin of potentially sort of mid-25 for where if everything goes in the right direction. I mean, is that completely out of the question? So that was the second one. And then the third one was just, again, just looking at ESCO versus Minerals. Why can't those businesses both generate the same level of margin? Is there something structural? I know you mentioned product mix. So if that is the case, what are the product groups within ESCO that really sort of dragged that potential margin down, please?

Sure, why don't you deal with the Chile question. I want to answer the margin question first, but then, chip in.

First of all, I'm excited that ESCO got the first question.

Yes. I was at a $20 well paid. No, as I mentioned, so I think the question is how we plan to go direct in Chile. And how we plan to enter the Chilean market, but it's go direct. So no, we're not going to go through a dealer. That's not our intent at all. We do best. We're on the ground with our customers, solving their problems, as I mentioned. We know this well throughout the world, and we know well in South America, specifically.

I mean we do it in Peru, we do it in Brazil. We do it everywhere else. So that's -- the plan is to go direct to our customers in Chile. I mean, as I mentioned, the great news is that our sister division, Minerals has been doing -- going direct for a long time now. So what that's going to help us is if you look at where the mining operations are, Minerals already has some infrastructure to support customers, we can leverage right off of that. So we're going to be able to accelerate our ability to go direct because we already have a sister division that's got some of that infrastructure set up that we can just leverage. We've done that in different pockets around the world as we enter new regions. We're always able to help each other kind of go faster. So go direct, and we'll go faster working with our sister division.

Yes. So I think -- on the margins, Jonathan, the way that we've tried to set this up is to say, look, we need to get to 20% margins plus because, in our view, that's the hallmark of quality that we've always felt the business is capable of and that's where we want it to be and should be, and we're now there and get there this year. And then for beyond that, it's sustainably above 20%. Now if you imagine a scenario where there's no CapEx cycle, we see no other opportunity to invest in innovation and R&D, and we have a perfect world with no need for cushions and contingencies, then the margins would probably keep calling up 100 basis points a year, but we know that's not going to happen. So the whole setup is to say we believe that we can be sustainably above 20% operating margins as a company. whatever happens.

So if we have a CapEx cycle and it dilutes Andrew's margins, we're above 20%. If we see we want to invest GBP 10 million or GBP 20 million in some potential breakthrough technology, which we want to have we have the flexibility to do that. If something goes wrong in the world, which is probably highly likely, we've got enough cushion within our commitment to the market to be able to ride through that. And in any scenario, still be above 20%. And so that's the way we've set it up. And so in some years, if some of those factors are not that strong, you'll see potentially a bit higher margins. But particularly if that CapEx cycle comes through, then that's going to be a depressing effect certainly for minerals, but we will remain at least a 20% operating margin company. So we've worked so hard after the last few years to build a track record of constant, consistent delivery, meeting the targets and so on. and we just want to keep doing that in the future, which is why we've sort of framed the whole thing in that way. Brian or Andrew, if you want to add to that.

I'm just smiling because I got asked that question out there, and I gave the same exact answer. So that wasn't pre-rehearsed but no, I agree with everything that John said. We need that flexibility. But in the perfect world, you will see a slide up.

Any structural difference between ESCO and Minerals is it -- just any sort of views there, just why that can't -- it's actually been the same margin on just [indiscernible]

I mean I think you're splitting the difference to say they're going to be massively different. We said low to mid-20s, low 20s for. I think Minerals probably has the greater operating leverage potential. If none of those other things happen, which might just nudge it up above ESCO. But I mean, I think they're going to be pretty close. .

I set the challenge.

Actually where margins are not where we were 2 years ago. I just need to keep up.

Right. Okay. Lush?

It's Lush. [indiscernible] I think I've got 3 as well. The first is just on back to Micromine and NEXT and the software platform. I mean when you're selling to a customer that's potentially using one of your -- or parts of your competitors' software, I mean, can they just buy 1 or 2 of your platforms and be able to integrate and share data between or is that a stumbling block in terms of getting them over? And I guess the follow-up to that is, if you can -- are there still frictions there that you then upsell the rest of it and get the rest of the platform across? I'm just trying to work out how it all fits in with the rest. So that's the first question. The second is just in terms of the cross-sell, clearly, like a big differentiator being part of the war platform is the minerals and the ESCO sales as being able to cross-sell. I mean have you had to change their incentive structures for them to push the Morcone platform? And then the third question is just on pumps. We've had a few of your competitors recently talking about that sector and pushing for different market positions. I mean how are you seeing that competitive landscape evolving? Any sort of pricing pressure or market share gains, losses, et cetera, I'd be interesting to hear your take there.

Very happy to answer that question. Kristian, why don't you start on the software? .

Yes. Okay. So the first question, I now see why you have your paper. So the first question is -- was around the multiple -- and I think John talked about these company -- our mining customers have -- might have 5, 10 different softwares that they're using, across the space that we've described. Traditionally, our customers are very good at finding ways to export and import and but that's becoming all of us in this digital transformation world that is becoming more and more unacceptable to people. They don't want to have a lot of messiness of exports and imports in different formats that they have to maintain and think through.

So the -- in general, we would describe ourselves as we play nice with others. We are not doing things to prevent people from having the ability to upload data into our software or download it so that they can use it in a way that's going to make the most sense for them. So our strategy around that is ultimately, as Avon described, the Nexus platform, where version control is easy all the folks that are working in each of these spaces. It's easy to see who has access to the license? What is the last model that they've been working on. So we just want to make it easy for our customers to use. And we also -- our longer-term goal is to have an open ecosystem that it is easy for them if they do choose to use a different software to be able to store data and pull down data so that over time, this is -- we're just making it so easy for them that they want to use all of our products. So that's the first one.

The second question was specifically around the cross-selling process Yes. So I think that I use the word, and I think we're using a very particular word that I think is important, called warm introductions. So we are not asking our ESCO and Minerals colleagues who can open any door around the world together. We are not asking them to sell Micromine software or other software or fast minor motion metrics. We are not asking for them to sell or become experts in our software. What we are asking them to do is have offer and support warm introductions. So when Andrew was talking about [indiscernible] or Sean was talking about a different customer site, we want to use the trust that's been built by the Minerals or ESCO colleague at that site to offer to introduce us to the mine planner or the mine manager. And yes, we are -- we have been very thoughtful about how to incentivize that behavior of the warm introduction.

Yes. And I just want to add to that because I think it's important to understand the discipline which I think is really important in that process. So we define or Kristian has done a great job of defining with Micromine, a warm introduction as you have to have -- that's not just 1 person you have to have multiple personas from the customer in that meeting for it to qualify as a warm introduction. So that might be the geologists, the mine planner, the mine manager a group the collective stakeholder group who's going to make the decision together for that warm introduction because we don't want to just go to 1 person and then get it stalled.

So we want all the key stakeholders in the room. So Minerals and ESCO are only -- they have a pipeline, if you like, to build those warm introductions and they have to get all of their customers up to that level where they can get all of those people in the room that then qualifies as the warm introduction that Kristian's team then picks up. And then the software sales folks come in, they take that forward in their sales pipeline with the Minerals and ESCO folks in the background to help with key account management and pick up the phone if things stall, but then it becomes a software sale so we're not asking pump people or GT people to try and sell software, it's the specialists who are making that sale and driving that through the conversion pipeline from that warm introduction to a license purchase.

Andrew, your opportunity to respond.

Yes, I think it's a competitive market. It has been -- it remains a competitive market. Key focus for us is always how do we provide the lowest cost of ownership for the customer. How do we provide that TCO as we talk about. And I think when you stand back minerals or in that core slurry pumping area. One, our depth of knowledge and understanding is different levels. [indiscernible], our market share in that [indiscernible] large sorry pump piece will be 3x somebody else and it has been for a long while. So the depth of knowledge and capability we have in our business to understand the application to tweak. And it's really, therefore, how do we continue to push the boundaries on technology. The core technology fundamentals are drugs materials. Today, you heard about how we can list new digital solutions, again, monitor the pump better, ensure it's performing better. And that service presence is so important to that TCO. So we're continually making sure the pumps operating optimal. And we're always just looking at how can we drive to the next service interval.

And the theses are thing for me is a kind of litmus testing, are we -- ultimately, what you're asking is are we gaining or losing market share. We'll talk for a number of years in trials. We win 90%, 95% every year year-to-date, we're still 90%, 95% of trials we are winning. So there's nothing tells me that we are losing share in the market. I can point to a number of examples as we did today, where we've gained a bit of share. And absolutely, I mean, we are focused on strengthening and deepening that position that we have. But we absolutely we're not complacent.

We have to demonstrate we're delivering customers value, and that's what we try to do day in, day out because through a mine life, the pump operating environment changes. And we're always bringing out incremental upgrades and it's not an annual October event like Micromine, but I can talk to you about 2 [indiscernible] and grow through bushes, if you're really interested afterwards. We're continually bringing out little innovations, again, pushing the -- and that's what gets us from going from 1,500 to 2,000 and allowing that minor to extend the shutdown. And that is so valuable to them, free up time. So that's the business model we've got. We continue to invest in it, indeed, we're increasing investment in many areas, and that's what's helping us to maintain, and I believe, strengthen our position in story pumping.

Okay, question over here. .

It's Rory from [indiscernible]. My question is on the growth algorithm, but I just wanted to follow-up with a quick clarification on slurry pump, if I can. I think in the past, you've talked about slurry pumps being about 90%, if not 100%, recurring sort of at aftermarket intensity metric for [indiscernible] slurry pumps, about 90% to 100%. Just the clarification is on the slide, there was a sort of range of 30% to 40%. I appreciate that's a sort of product mix. But is there anything to suggest that aftermarket intensity and slurry pumps, in particular, has come down over time if you're doing more efficient, I guess, just more efficient pumps, right, and less aftermarket intensity. That's the first part of the question.

Yes. Sorry, just to clarify, is that the 90% to 100%, is that the aftermarket capture rate you're talking about? .

Not the capture rate, but the intensity. So how much of the OE value is generated in aftermarket revenue every year beyond the every sale because it was previously 90% you talked about.

Well, yes. So it's not is for the really big mill circuit pumps is not that high for the kind of smaller, lower Weir applications, sorry, [indiscernible]. So that's just I wanted to just clarify that.

So 100%, a large build circuit the core pump in the heart of that mine in a hard rock environment, we'll still be producing 80%, 100% per annum in spares. As we extend life logically, you might need one less -- ultimately one less part a year. Does that reduce it. But obviously, we are looking at our overall margins. How do we make sure we share that TCO benefit. With customers so back to early to answer, how do we sell commercially, we're selling the value we are creating for the customer. So for us, I would say, the ratios haven't moved materially at all, but it's simply a tailings pump operating with hardly any solids in it, it might be down at 5%, 10% per annum. Where [indiscernible] slurry pump and we do a whole range. That's why the range you saw on the -- boards are trying to just say, look, you take all the range of pumps we provide and you average it all out, you're at that kind of range. But yes, the big mill [indiscernible] John said, that still sticks .

Okay. That's really helpful. And tying that point into my question on the growth algorithm, let's say, at the group level or the minerals level is 30% every year. from dollar of OE sales is $0.30. If I run the math on that, sort of $500 million of OE expansion every year, at 30% and then adding that on to the sort of aftermarket. I can quite quickly get some quite impressive numbers. That's almost an exponential growth.

Now you've delivered very good growth, but it's not expansion, right? It's thinking about that breakdown of the growth algorithm, I could almost get to that mid- to high single-digit number on that piece alone, but you have talked about pricing, ore grades declining, other pieces in that mix. So why is the installed base expansion only in the 1% to 2% range versus the sort of 7% that I can get to in my head doing that math. Now please tell me how I'm wrong here. But is it because some of the non-pump parts have lower aftermarket intensity? Or is it -- there's an element of replacement rather than pure expansion? And would that -- and then this is the final part of the question, apologies. Would that change in a new mining CapEx cycle? So we'd be doing less replacement work and more greenfield and therefore, that growth algorithm potentially could kick on even further. That would be my question.

Yes. Yes. I mean if you take the $500 million we talked about annual CapEx or OE input per year. That's a mixture of projects, brownfield upgrades and replacements, you're absolutely right. The reason it's not flowing through, that $500 million is not all additional installed base. We are upgrading replacing. It's hard to get a specific figure. I would say, of the $500 million, $100 millio is what I would call medium larger projects specifically. That's the bit that can bounce around, move around. We typically do about $100 million a quarter to $400 million a year of smaller, and that can be both increasing installed base, but also a lot of that will be replacement or upgrade or changing solution within the mine. So yes, that's why the whole 500 typically doesn't flow through every year to install base growth.

Great. If I could squeeze just 1 more in on margins. You've previously talked to a sensitivity in group margins around a 1 percentage point move in OE versus AM. Is there any -- I think it was 30 basis points maybe 1 or 2 or 3 years ago. Is there anything to think that, that changes in the future, given sort of structural expansion of margins versus the mix? Any kind of pointers on that if we wanted to model out a new cycle in the spreadsheets. .

No, I think that's about right. I mean, obviously, as the digital solutions business continues to grow, that may change. But in the near term, as we look to grow that business, it hasn't been a significant change in that percentage. So I think that's so good for now. But in 3 years, I'm hoping to give you a different number.

Great. Thank you. Kristen, I just had a question around the white space opportunity you talked about. So about 47% of the global opportunities in the white space. I just wonder how are you balancing sort of going after that space as well as the then this was because you've provided a lot of inputs around the point solutions being very competitive. And so you're going in the vendor space and replacing competitors. What is the approach in that white space? .

Yes. Thank you. I think I did talk before about we really see the Motion Metrics business is predominantly playing in the white space. So I really think it's we're still -- we're thinking about -- and when we talked about the lead piece around the warm introductions, we're thinking about the markets and when you think about all of wear and you think about the workforce that we have in sales, the market size is tremendous. So it really is around our regional managers thinking through, well, what are the hottest leads? Where is the -- where can I go and what should I -- how should I be using our sales resource. So I think that it's a combination of what's coming to us that we're actively responding to -- and we're actually in the kind of conversion point right now, 7 months into, hey, we're spending quite a bit on getting trade shows and just generating brand-new leads versus using our warm lead source that we now have through Minerals and ESCO.

So I think the answer to the question is it's a mixture because we're focusing on what's coming in the door to us and then trying to sort through how do we choose with a finite set of sales resources where we go because of how big the size of the market is.

Maybe just to follow up on that. It's just in the 47% [indiscernible] space opportunity, would you consider that as like less competitive to go and win opportunities there? Or what are the characteristics of that space?

And I think another reason why the vended space is quite attractive to us. And I talked about this at the break with a few people, but the idea that the Tier 1 mining companies are using hundreds of licenses. We talked -- we had some customers in Central America, for example, that they may have 200 license is on mining customer. So our opportunity to scale to that level with big customers is not the same if we're targeting Tier 2, which is white space or even smaller organizations. So we're very attracted to how do we scale with Tier 1s because we think that for the -- being resource limited on the sales front, that's the better place to put our efforts. But obviously, we're going for vended space. But as I've described, we're very confident because we have modern technology that's being regularly reinvested in.

Yes. Just to add one thing. I mean that white space is people who are not using software for those workflows at the moment. So they will literally be using Excel spreadsheets for their drill logging or manual stuff instead of any form of software at all. It's not -- people are not using software. So to get them to convert from what they're doing today and a lot of them, as Kristian said, maybe Tier 2 junior miners, getting them to convert to expensive software is possible, but it's harder and getting experienced software users to in the vendor market to convert to a better product. Just there.

Vivek Midha from Citi. A question just following up on return on capital employed. There was a -- I mentioned early on in the slide pack about focus on growing ROCE. We've discussed margin improvement. But I'm just curious if there are any other drivers that you see that can further support the ROCE development and ultimately where you think that can go?

Well, we continue to strengthen through our growth and the quality compounder that we are and bringing out the returns is -- and we're not a capital-intensive business, right? I mean, our last big capital-intensive [indiscernible] foundry, which, as Sean talked about, was ahead of time, under budget and delivering more than we said. So we do invest a lot in R&D. That does have an impact, and we do 2% of our sales generally in terms of R&D, but we're not overly capital-intensive. So if we get that quarterly compounding, now you throw in the software business, which isn't very capital intensive, that ROCE is going to continue to grow. It's not anything we're putting a target on because if we see the right opportunity, we're going to take that. And that's what we did with the acquisition of Micro Mind that had a slight impact on that, but that's quickly going to come back. And so we will continue to grow that ROCE over time as a quality compounder.

Yes. And Andrew and Sean should comment, but I think with all the work that we've done through capacity optimization on the facilities around the world, we do feel that for the growth that's coming we're going to need to spend a bit of CapEx, but it feels like we've got the right capacity in the right place now for the growth that's coming, as Andrew was saying, it shifted from high cost to low cost in some cases. So we're not going to need to go and make big investments in new capacity in the foreseeable future. Tell me if you got a surprise CapEx coming guys. .

Yes. I mean I think to John's point, we've got the broad roof line, if you like. And so we're always actually looking for CapEx investment approval opportunities because often it's one of the best, most safest if you can a new machine [indiscernible], you can get a less than a 2-year payback are fantastic. So absolutely, that's our ongoing focus. I think we create our own capacity as well. We talked a little bit today about continuous improvement. Part of the benefit there is not just savings, actually, you're increasing your internal capacity.

So when I look forward in minerals, I don't see the need for a big new [indiscernible] type investment, but we are continuing to invest in the business, to be clear. But fundamentally, as Brian said, naturally quite a cash-generative business and the level of CapEx that you need to upgrade machinery, et cetera. It is never huge. So back to that living depreciation of the thereabouts. I think that's something that we've done for it for a while.

No, I agree. I mean, ESCO, as Brian mentioned, made a significant investment in the last few years, it's turned out wonderfully. When it comes to our foundry and our other sites, we have the right footprint, the right rooftops, if you will. And we're always looking, is there a way to improve customer service in different pockets. I mean, you get the question about Chile. We're going to think about that. What do we want to have locally, but those are usually much smaller. We try to work together with minerals to make sure that we're kind of leveraging as much as we can each other's capabilities locations, but those we're always kind of looking for as well. It could be a small capability within a shop [indiscernible] customer in that region that's what we're kind of looking for.

It's [indiscernible] from BNP Paribas. Just a very quick one. How are you going to update us in the future on the software business? Why? Do you spend a lot of money. It's very well in the ESCO division. We want to see those growth rates. We want to see the margins. So at the moment, we dig into the footnotes, what you're going to do in the future?

Well, we want to share the full picture with you as soon as possible. we have a year, as Kristian described, we have at least a year of consolidation 2026, where we need to -- we're pulling motion metrics out of ESCO moving it into the software business, driving the sort of synergies with the Micromine sales process and disciplines and so on. Fast2Mine in its 1-year earnout at the moment, so we can't really touch that business until we get to the end of that period. And of course, Motion metrics is going through the transition from Perpetual to Software as a Service subscription annual subscription going forward.

So there's a lot going on at the moment and complexity of that. But our aim is at the beginning of to sort all of that out. So we've then got the purely formed software business in the final form and that platform for growth. And as soon as we got enough critical mass, the numbers are big enough we will disclose it as a separate division so that you guys have visibility to the growth and margin profile and detail of the business. So it's not -- we are not giving you an exact date now. We're going to see how we go, but that's the plan.

According trial for us with 10% profit, you can have an own division. So 2027, if your growth comes comes along the right way. You should be there, right? So...

We'll let Brian decide on that.

if you do the math. I don't think you quite get it because don't forget, we're growing the ESCO and Minerals business quite substantially as well. So -- but we'll get there not that far off as our hoping goal. And as Jon said, we are looking forward to disclosing it when we get to that critical mass.

Yes. And so one follow-up on your explanation, John. You said the integration and a lot of moving parts. So I'm getting scared for extra cost. Is there anything that we should be aware of?

No. Nothing should be [indiscernible]

It's Will here from [indiscernible]. How do you think about the trade-offs in incremental capital allocation between potential software acquisition, where the best assets are typically offices of recurring revenue and an industrial acquisition in minerals where you're paying a multiple on EBIT or EBITDA?

Well, I think if we find ourselves in the happy position, which I haven't done in living memory, where we've got 2 really hot acquisitions in 2 different spaces that are going to -- either one of the other we'll take up the capacity that we have from a balance sheet point of view, of course. We've got to be -- we will retain our strategic and financial discipline in terms of how we think about those acquisitions.

And so in that regard, we've got -- we will allocate capital to the best opportunity that we think is going to give the best payback and returns. That being said, if you get to a point where they're both as good as each other and it sort of maximizes the debt capacity, then I think the option of equity remains open to us, recognizing that the bar is a bit higher for that, but we think it's the right thing to do, then that's what we'll do. But in the context of opportunistic MA, you don't often find yourself in that situation.

But I think either way, we will be able to do what we want to do and what is the right thing to do and in line with our strategic and financial criteria.

Last one from me, I promise. It's Rory form [indiscernible]. I don't know if the question is for John or Brian. But Clearly, the growth is coming through, the margin is coming through. It's a very strong, sustainable sort of backdrop story here. if the market isn't rolling that in a higher multiple in 2 or 3 years, would you look at relisting in the U.S?

We are very happy with where we're headquartered and listed as a company today. I think -- and we've seen our multiple expanding over the last couple of years based on what we've done. We have been in the context of the U.K. market, where we've seen outflows from equities, we've been able to go to other jurisdictions, go to the U.S., go to North America and attract new investors onto our balance sheet. So we don't think there's a need to do anything different than we're doing today. We can tap into global capital pools. We've proven that that's the case. I think North America is now on par, if not higher than the U.K. in terms of our total register. So we can do that. And I think we will continue to get rewarded for delivery on this fantastic strategy. where we are. So that's the plan. Thank you Okay. Any more questions? All right. Well, I think 5 O'clock, that's probably the witching at. So thank you very much to all of you in the room and online to have joined us today for our latest capital markets event and for the questions. For those here in person, there's going to be a further opportunity to mingle outside and see some of the demos, if you've got more time to do that. But I hope you're taking away from today but we have such a compelling story and so much opportunity ahead of it. I feel that the team is very energized and excited about what we're doing and the opportunities that lie ahead not only in our outstanding hardware business but in our outstanding new software business as well. And yes, we're looking forward to delivering on that for all of our stakeholders. So thank you very much again, and I'll see you outside.

Good morning. Thank you for attending today's Weir Group plc quarter 3 IMS Quarterly Update. My name is Sarah, and I'll be your moderator today. [Operator Instructions] I would like to pass the conference over to our host, Jon Stanton, Chief Executive Officer. Please go ahead.

Thank you, operator, and good morning, everyone, and thank you for joining us today for our third quarter trading update. As usual, I'm joined by our CFO, Brian Puffer, and after a brief overview from me, we'll be happy to take your questions.

So starting with current trading, where encouragingly, our core markets of copper, gold and iron ore are strong. This reflects our customers' drive to maximize production, capitalizing on supportive commodity prices and structural demand and is reflected in both positive original equipment and aftermarket activity levels.

Demand in the quarter was impacted marginally by the effects of certain well-publicized copper mine disruptions as well as a softening in demand for diamonds, platinum group metals and mineral sands. And while we expect these effects to continue in the short term, overall activity levels in global mining markets remain positive, and the diversified and resilient nature of our business is continuing to deliver growth.

The performance of our Minerals and ESCO divisions in the quarter reflects this positive underlying demand, accelerated by strong execution against our strategic growth initiatives. In Minerals, we maintained our win rate of over 90% in competitive large mill circuit pump trials and capitalized on aftermarket demand from our growing installed base of HPGRs.

In ESCO, customers chose to adopt our MOTION METRICS SaaS platform and access our unique features to drive productivity in their extraction operations. ESCO also realized several large bucket wins in APAC, compounding success in this key region for geographic expansion.

During the quarter, we announced the acquisition of Fast2Mine and completed the Townley transaction. Both of these acquisitions enhance our market presence and broaden our product offering. We're making strong progress with both Townley and Micromine against our deal model assumptions, and I'm pleased to report that both are delivering as expected.

Now turning to orders, where on a constant currency basis, group orders were up 2% year-on-year. Group original equipment orders grew 15% year-on-year after normalizing for an exceptionally strong prior year comparative, which included GBP 48 million of large orders on the OCP and Reko Diq projects. This underlying trend reflects strong demand from brownfield and debottlenecking projects during the period.

Similarly, aftermarket orders grew 10% year-on-year on a constant currency basis, driven by strong demand for our mission-critical spare parts and expendables. Underlying organic growth of 5% was complemented by a further 5% contribution from the recent acquisitions of Townley and Micromine. Overall, Weir has a very healthy order book across both divisions, which we're focused on executing against during the fourth quarter.

Now turning to divisional performance, where in Minerals, original equipment orders increased 13% year-on-year, excluding the large Reko Diq and OCP greenfield project wins just discussed. This underlying growth was supported by continued momentum in brownfield and debottlenecking solutions as customers seek to maximize production and productivity. In aftermarket, orders grew 5% year-on-year, primarily driven by the expansion of our installed base of equipment, particularly in pumps and HPGR solutions. Having completed in the quarter, the newly acquired Townley contributed an additional GBP 6 million to orders which is in line with our expectations.

In ESCO, original equipment orders grew by 36%, reflecting continued market share gains in mining buckets, the geographic expansion across the strategically significant APAC region. Aftermarket performance was similarly strong with orders rising by 21% year-on-year, driven by our market-leading technology, customer intimacy and a strong contribution from Micromine. In the quarter, market share was enhanced with another 49 net bigger conversions, and we've seen excellent strategic momentum within MOTION METRICS, where we continue to expand the installed base and accelerate adoption of our solutions as a SaaS offering.

Micromine is performing well against our previous expectations, contributing GBP 17 million in orders for the quarter, in line with the plan. We are delighted with the progress to date, and our near-term focus remains on accelerating growth through our global distribution platform and the strength of our relationships with our customers, both at local site and enterprise levels.

Turning to execution where our Performance Excellence program continues at pace. During the quarter, we made further progress in our capacity optimization and lean process work streams as our EMEA and APAC regions continue to streamline their operations. Strong execution across the business underpins our confidence in achieving GBP 80 million of absolute cumulative savings in 2026.

We made significant strategic progress in accelerating our growth through acquisitions. In August, we completed the acquisition of Townley, enhancing our exposure to the attractive phosphate market. The acquisition also provides a strategically important foundry in North America, bolstering our Minerals division and improving proximity to key customers in the region. The Minerals North America team is on the ground in Florida right now, working with our new Townley colleagues, and they're making good progress across our integration work streams.

In September, we announced agreement to acquire Fast2Mine, a Brazil-based mining software provider, offering a contemporary open pit mine management solution. Fast2Mine software fills a gap in the Micromine portfolio and is highly complementary to the Alastri open pit mine planning and Pitram underground mine management solutions. The acquisition will expand -- accelerate our expansion into the South American mining software market, providing a strong and immediate presence in Brazil, owns some of the world's largest mineral deposits and also offers a significant international growth opportunity. We're looking forward to welcoming Fast2Mine to Weir and are excited by the opportunity to further accelerate our vision for a digitally enabled mine optimization. The acquisition is expected to close in the fourth quarter, but will have no impact on our financial guidance for 2025.

On net debt and given our recent acquisition activity, our net debt-to-EBITDA ratio is expected to sit just below 2x by the end of 2025. And we expect strong cash generation from our aftermarket-focused business model and Performance Excellence investments to underpin a strong deleveraging trajectory back to our normal debt-to-EBITDA range of below 1.5x by the end of 2026.

During the quarter, we completed a AUD 400 million bond issuance, our first debt raise in that country. The proceeds from the bond will be used to partially refinance our existing bridging loan from the acquisition of Micromine at a more attractive interest rate and highlight our commitment to maintain a robust and flexible balance sheet.

Looking to the fourth quarter and the outlook, despite a number of uncertainties facing the mining industry, not least the outcome of ongoing tariff negotiations between the U.S. and China, we remain focused on disciplined execution against our strong order book. We continue to execute well and have remained proactive in managing our global supply chain and customer pricing strategies to mitigate the full impact of existing tariffs and other supply chain disruptions.

For the full year, we reiterate our guidance for growth in constant currency revenue and operating profit. Operating margins of circa 20% and delivery of free operating cash conversion of between 90% and 100%. We continue to expect headwinds from translational foreign exchange, which we currently estimate to be GBP 105 million and GBP 25 million on our prior year comparative for revenue and operating profit, respectively.

Looking forward, Weir represents a compelling value creation opportunity as a mining technology leader. We remain committed to delivering our longer-term guidance to outgrow our markets, expand margins and cleanly convert earnings and cash, while remaining resilient and committed to doing the right thing for our people and the planet.

Our Capital Markets event, on December 3, will further illustrate how we intend to deliver these excellent outcomes for our stakeholders. The event will cover our full business, but with a particular spotlight on how our software strategy enhances our customer proposition and value creation opportunities. An extended event landing page with details on the agenda and logistics is now live via our Investor Relations website, but if you have any questions about the event, please reach out to the IR team for more information.

So in conclusion and summarizing the key takeaways from today's call. Our markets are positive, and we are well positioned as our customers look to address their critical operational and sustainability challenges. We're executing well against our strategic initiatives, remaining on track to deliver GBP 80 million of cumulative Performance Excellence savings in 2026 and realizing value from our recent M&A activities.

We remain on track to deliver our full year 2025 guidance, including growth in constant currency revenue and operating profit, alongside our targets for operating margins and free operating cash conversion. And finally, over the longer term, we offer the compelling value creation opportunity. We operate in highly attractive markets. We have a clear strategy to grow ahead of our peers and at sustainably higher margins and we are delivering on that ambition.

Thank you very much for listening. And Brian and I will now be pleased to take any questions you may have, so we hand back to you, please, operator. Thank you.

[Operator Instructions] Our first question comes from Jonathan Hurn from Barclays.

Just three questions from me, if I may. Firstly, I just wonder if you could sort of talk through the outlook that you're seeing for OE. I mean if we look at that base order growth of 15%, it's pretty good, but do you think you can accelerate here? Do you think we need to get more exposure to gold? And also just in terms of the large orders above GBP 25 million. Are there any sort of possibilities in the pipeline there?

The second question was just on Micromine. We break that down 31% of the business is exposed to gold. Can you just sort of talk about the activity levels you're seeing coming in to Micromine? I think if we look at the historic growth rate for that business, it's been around about 25%. But because of this gold exposure, do you think going forward, that growth rate can be exceeded? And then the third and final one was just on ESCO, just in terms of that APAC expansion. Strategically, it's pretty important, I think in some of those markets, you don't have good market share, maybe possibly in buckets. But what sort of strategy you're putting there? And why is that starting to really come through now? I'll leave it at that, those are the 3 questions.

Yes. Jonathan, thanks very much for the question. Yes, so I'll take you through those. So I mean, starting with the outlook for OE, yes. I mean I think we're really pleased with our underlying 15% growth quarter-on-quarter. As I said on the call, it really demonstrates the very high levels of activity that we're seeing across existing mine sites, brownfield, debottlenecking, sustainability solutions and with particular strength in gold, as you would imagine. So with where commodity prices are at the moment for our main exposures and if you think about it, a couple of gold and iron ore are circa 50% of our revenue, we're certainly seeing pretty strong and enduring demand drivers in that space.

And even in commodities that have been somewhat under pressure and I think nickel being a great example of that, we have lost some work because of the closure and mothballing of some of the high-cost nickel mines in Australia, but we've won just as much, if not more, in the expansion projects coming through in Indonesia, which I think demonstrates that sort of resilient and truly, truly global footprint that we have. So sometimes in some commodities, you get some puts and takes. Nickel, which I think has probably been tough for several of our peers, we're pretty net neutral given the wins that we've had in -- particularly in Indonesia.

So I think the underlying brownfield activity, we feel really good about. Our pipeline is remaining very strong. And then the larger orders, I haven't got a crystal ball with me at this point in time, but I do think the outlook is difficult to predict exactly when things will come through. But I think the outlook continues to mature in a positive manner. And I think the intent is there across our customers and willing to deploy capital in the future facing and growth commodities. I think that's been bolstered by the sort of the defense and national security issues coming out of the geopolitical situation at the moment.

And I think I just talked a bit about on the first half call, the political intent that we're starting to see around the world be that in the U.S., South America, increasingly, there is a real government focus on how we accelerate some of these mining projects. So I think difficult to predict when they will come through, but I think the outlook is maturing in a positive way.

Turning to Micromine. Yes, I mean, really, really pleased with the first period of ownership here with the orders and sales coming through back in line with where we expected to be. Literally, we've just launched the half year product upgrades. We have a momentum event each year when all of the upgrades come through in each of the software products and that's landing incredibly well with our customers. So the pull for the software that we have, the breadth that we can bring at an enterprise level, we're really, really encouraged by it.

At the time of the acquisition, we said, the business has grown at 25% historically. We think we can grow it by more than that given the global distribution platform that we have, the fantastic site level relationships we have with our large customers, but increasingly the enterprise-level relationships. We've already got a couple of really good examples where those more senior enterprise-level relationships that we've had traditionally with ESCO and Minerals have really unlocked the door for Micromine, so we'll give some quite exciting examples of that. There's a little taste for you for the Capital Markets event in early December.

And then on ESCO, your final question, yes, I mean, really, really pleased with the progress that we've made in the Asia Pacific region. It's probably a region where our market share is just in core GET, we have ambition to take higher and the team is doing a great job of that. But one of the key things that was a key part of the strategy there is that Australia is probably one of the more fragmented markets on capital buckets where we see a big opportunity. And it can be a bit more lumpy, given the more expensive nature of those products relative to GET but the teams had a great pipeline, and that pipeline really came through very strongly in the third quarter.

So I think it's just a market where ESCO has got some great momentum at the moment. I mean in [Iran], it's probably one of the markets where the growth profile -- the market growth profile is generally a bit flatter than say, the Americas. So to be winning share there is really great news, team's doing a contesting job, and we expect that to continue.

Our next question is -- comes from Lushanthan Mahendrarajah from JPMorgan.

I've got two questions, if that's okay. The first is just on ESCO aftermarket organically and I think you mentioned sort of MOTION METRICS being a big contributor there. Can you sort of -- so also give us a bit more color on exactly what you're seeing there at some of the Micromine synergies that's coming through just exactly what's sort of driving that sort of pickup in growth? And then the second question is just on Q4 deliveries and obviously a bit of a ramp-up needs in Q4. There's a lot of moving parts of sort of Reko Diq, Micromine, Townley, et cetera. But can you just help us bridge that Q4 a little bit as well, please?

Yes. Sure. Thanks, Lush. So yes, on ESCO, I think where we are with integrating Micromine in -- MOTION METRICS in the Micromine, is that we're still in the planning phase for that at the moment. So we're working through that right now, and that's expected to go live in terms of full integration in Q1 of next year. So it's quite -- there's relative complex situations to put those two businesses together. But we're very, very excited by what that will deliver. So the great progress that MOTION METRICS has actually made, particularly in this quarter, that has been making through 2025 is really nothing yet to do with Micromine. So if you like, that still -- that benefit is still to come.

So this is really the maturation of the building of their pipeline. We had some great wins across particularly ShovelMetrics and TruckMetrics as well, a big sort of more enterprise-wide win in Central Asia there. So again, that team has been doing a fantastic job. And when I look back over the first two or three years of that acquisition then, the growth rate there for different regions, maybe not quite as strong as they wanted, but it's now really starting to come through very strongly. We're seeing that. We see great performance coming out of MOTION METRICS this year.

And as we bring MOTION METRICS into that Micromine model, I would sort of characterized -- I think I characterized in the past that Micromine is really a scale up and when we acquired MOTION METRICS, it's more of a start-up. So it's different challenges. So I think plug-in MOTION METRICS next year into that scale-up strategy and the capabilities that Micromine has to commercially drive more success. I think it's just going to turbocharge the business. So we're really pleased with what MOTION METRICS has done this year and very, very excited for next year as it comes into the Micromine portfolio.

And then, yes, from a Q4 delivery point of view, look, I mean, I feel really good about where we are looking at we've delivered in the fourth quarter. It's a big fourth quarter. We called that out in the press release and we [indiscernible] about that. But if I'll break it down from an OE point of view, everything we need to deliver in Q4 is in the order book. So it's really just about execution. And as you can imagine, a lot of planning from a supply chain and manufacturing perspective is going into how we deliver that. So we've got fantastic plans to be able to do that.

And some of that is the big projects, particularly Reko Diq, the HPGRs, which are going out in the fourth quarter, a bunch of GEHO pumps on large projects as well going out. So I think from an OE point of view, really just about delivery, I think we've got a great time in place to be able to do that. Aftermarket, we want to see the run rate continue in the fourth quarter, but I feel really good about that. And if I sort of contrast, maybe just to give you a bit of color on Q3, what we saw was an okay or average July in terms of spares aftermarket run rates, August was quite soft, which I think was a bit of a mix of holidays in the Northern Hemisphere, plus, I think it was peak uncertainty with tariffs and all the [rationale] that was going on.

But September bounced back really, really strongly in terms of the aftermarket run rate. So net-net, that meant that aftermarket was okay for Q3 in terms of the orders we saw, but the exit rate was really strong. And every indication we see -- we're seeing at the moment is that, that will continue. So I think we feel really good about Q4 for execution. We had a similar Q4 last year, but all the building blocks are in place to be able to deliver.

Our next question comes from Edward Hussey from UBS.

I mean maybe just sticking to the aftermarket comments. I mean you talked in H1 about mid-single-digit growth in H2. I'm just wondering, does this still apply given you delivered 5% in Q3 but have that order phasing impact in Q4?

Yes, it does. So the outlook, I say the Q3 was net of quite a soft August in terms of aftermarket run rate for various reasons. But as I said, September is really, really strong. We're seeing that in October. That's what we expect to see through the balance of the year, and we can see that in the pipeline that's coming. So we feel good about being able to deliver that.

Okay. And then just on these copper projects, where you talked about disruptions and mine closures. I mean I'm assuming it's in sort of minerals aftermarket, [indiscernible] is the biggest impact. Do you have any sort of quantification in terms of how large this impact is?

No. But we're just calling it out because it's probably in the round, it's probably a percentage or two on aftermarket for the division in Q3. I don't have the exact number, but it will be that order of magnitude. So not massive, but enough just to sort of slightly tinge the orders. And it's -- obviously, you're seeing some of the copper mine disruptions, Grasberg, Quebrada Blanca, some others in Latin America. And then in Africa, diamonds and PGMs weak and in Europe, mineral sands, which is -- that's a bigger part of the business in Europe and was driven by just like everything China has been saying about export control.

There's actually been dumping of certain commodities in Europe, which has now stopped at September effect, but we saw a bit of that coming through in the order trends in Q3. So they will fade away, but just calling it out to be transparent in terms of the things that we're seeing across the world at the moment.

Okay. That's very helpful. And then maybe just final question on [indiscernible]. But just wanted to talk about the sort of profit bridge for the full year. So first of all, I mean, guidance to GBP 10 million of Performance Excellence. I mean it sounded like on the last call that this was -- there's no real risk or downside on this GBP 10 million. If anything, it has risk on the upside. Is that still what you're seeing in terms of delivery in Performance Excellence?

Brian, do you want to come in and I want to give you an opportunity.

Yes. Can you hear me okay?

Yes, Brian, go ahead.

Yes, in terms of Performance Excellence, it's actually over GBP 20 million we're going to deliver for the year. So we are on track. We're continuing to drive everything we said we'll be doing in Performance Excellence. There's no change in guidance for this year. There's no change in guidance for the GBP 80 million we expect to deliver in 2026. And like I said, we're seeing some real progress in this area, and we'll continue to do so, which is helping the margins due to that circa 20% we were guiding towards for the end of this year.

So yes, I think for H2, you're saying GBP 10 million is that just as [indiscernible]. But yes, we will deliver at least the GBP 20 million, and we will exceed the GBP 10 million, I think what you're referring to is the second half, performance. So things are going as planned.

Okay. And I'm sorry if I'm holding the mic, by my final question just on the mix impact for full year. I mean, again, you talked about in H1 having a neutral impact for the full year. Is this still the case in terms of the OE and mix? Or is there -- or should we maybe think about a shift in one direction or the other?

Do you want me to take that, Jon?

Yes, go ahead, Brian.

Yes, with the mix, we had a strong aftermarket performance in H1 with OE. But as Jon previously mentioned, we've got in the order book, a lot of large orders from the Reko Diq and other projects we announced last year going out. So that mix will come back more into the norm. So we are seeing that mix having a negative headwind in the second half of the year. But as Jon also said, we're having strong aftermarket performance. So we expect to get back more to what we've seen maybe in the year or a year before in terms of overall split for the year.

Our next question comes from Christian Hinderaker from Goldman Sachs.

I want to start with the basic question. Just a reminder of any inherent seasonality in each of the two businesses, particularly in terms of orders? I know Q4 is obviously key for outbound shipments. But just a reminder, that would be helpful.

I think there's nothing really to call out. I mean, as I said, to a degree in my earlier comments, original equipment can bounce around a little bit depending on the order profile of larger orders, but the delivery is all about shipments and what's in the order book. So we feel good about that. And then minerals aftermarket can tend to be slightly positive order mix first half and then more weighted to revenue mix in the second half. So I think you probably -- you're probably going to see that coming through, as Brian just described, but nothing really else to call out as we sit here today. So we're not seeing anything that would surprise me in any way.

You mentioned also in the release that you fully mitigated the trade tariff so far. I appreciate it's a fluid scenario. Can you just talk a little bit about that in terms of is that price? Obviously, maybe that not everybody has had that level of success, so any color there would be helpful.

Yes. So big picture, it's been a combination of both price increases where we had no other alternative but in most cases, trying to support our customers by moving production around our global footprint from a manufacturing and supply chain point of view, so that we could limit the effect of tariffs on imports, particularly into the U.S.. And those countries that are also playing that game. So I think the business did a great job of mitigating what we could mitigate without price. For any bigger ESCO issue, for ESCO, the minerals given the scale of production for ESCO that we have in China, but the team did a great job of mitigating through supply chain in there.

And then when we were in the unfortunate position that we had in the past some residual price increase on to customers, we've done that, and we've done that in a way that's in the round, protected our overall gross margins. So we feel we're good about that. And then obviously, we're waiting to see what might happen with the latest discussions, call it that, between the U.S. and China, which were looking a month ago, because it could be challenging, but that now seems to be moderated following the Trump-Xi meeting last week. We'll see.

We start to see the final detail, but hopefully, that will land in line with the noises that were coming out of that meeting, which should mean that from -- actually, we're in a more stable environment. So as I'd say, we've fully mitigated. Yes, and it has not just been tariff, it has also been supply chain disruption a little bit through the third quarter just with all of the uncertainty that was being created in the secondary derivative of those tariff discussions and the ongoing sort of geopolitical uncertainty. But I think -- I hope we see the end of that as well as we move into the fourth quarter.

Our last question comes from Tore Fangmann from Bank of America.

Yes, just one more to ask. Just a follow-up here on the activity in the aftermarket. I understood that the activity has accelerated into September and also now into October. Just from your view, very top down, there is an expectation in the market for aftermarket to be able to grow mid- to high single digits in -- across mining equipment peers. What would need to happen from your viewpoint for this to actually happen for the next, let's say, 1, 2, 3 years? Do we need a recovery in nickel or in PGMs basically? Or is there something else that needs to happen?

Yes. Great question. So yes, look, I think if we look back at the history of minerals over 15 years, and we look at the history of ESCO since that's been in the Weir portfolio, and those -- and we've delivered 7% CAGR on aftermarket through the cycle. So that is broadly where we would expect to be over a period of time. For next year, we haven't given guidance yet, but we'll also do that when we give our guidance in February, beginning of March, following the full year results of 2025. And that's when we'll be more specific about the growth rates that we expect to see in 2026.

But certainly be -- we would expect it to be in that mid- to high single-digit range, exactly where it will be in that range, we'll see as we put our budgets together over the course -- over the next few weeks and be in a position to provide that guidance. But structurally, I don't see anything when you look through the cycle, that means we shouldn't be able to deliver that kind of growth rate. In fact, we definitely should understand for us to be able to do that, I think when you look at where we are today, the combination of our technology, the customer intimacy we have, the increased customer relevance that we now have because of our digital and software solutions, which is having a real impact in the market and helping to open doors in different ways as well, I think, is all for the good.

And I think when you look at the broader political environment in terms of support for increased mining and commodity production, particularly for copper and the future-facing metals, where gold is today, I think anybody is really seeing gold come back significantly from where it is, which is going to be positive for that part of the world. So you're always going to get a bit of [indiscernible] across commodities. But again, it just comes back to the nature of the Weir business, our fantastic global footprint and in every mining corner of the world, wherever you want to be, Weir is there.

So we're diversified. We're resilient, and we've got those fantastic competitive advantages and attributes to our product portfolio, which, as you know, should set us up for enduring success. So yes, I forget about that. Thanks for the question.

There are no questions waiting at this time. So I'll turn the conference back over to Jon Stanton for any further remarks.

Thanks, operator. Just to say thanks again for your participation this morning. We appreciate that and for the questions. If there are any follow-ups, obviously, the IR team will be available through the day to be able to help you and we are seriously looking forward to seeing as many of you as possible at our forthcoming Capital Markets event and demonstrating exactly the exciting future that we have at Weir as a hardware and software provider to the mining sector. Thanks again. Take care.

That concludes Weir Group plc quarter 3 IMS quarterly update. Thank you for your participation. You may now disconnect.