The Glasgow-based Weir Group has been affected by a strong pound and has reported a fall in first-half profits and revenues as a result. The engineering group, which manufactures valves and pumping equipment for the mining and oil and gas industries, said that currency movements reduced operating profits by £23 million in the half year to 4 July, adding that this is likely to increase to about £40 million for the full year.

Group revenues fell 5%, from £1.2 billion to £1.1 billion in the first half of the year, while pre-tax profits declined from £165 million to £158 million compared with a year ago. Reported operating profits fell 8%, from £195 million to £178 million, with operating margins dropping from 18.1% to 17.6%.

However, chief executive Keith Cochrane said that Weir remains on track to meet its full-year expectations, with strong revenues and profit growth in the second half of 2014. The group is also continuing to profit from its expansion into North America’s shale oil and gas markets.

Matthew Spurr, analyst of the Espírito Santo investment bank said: “Healthy orders and revenues are encouraging, but the margin performance is slightly concerning.”