LONDON (ShareCast) - Molten metal flow engineering group Vesuvius said that first-quarter trading was in line with expectations but conditions in many regions remain challenging.

The company said it has seen "encouraging signs of increased activity in some markets", particularly in Europe, but trading remains mixed elsewhere.

Vesuvius said global steel production during the first three months of the year was 2.5% higher, according to estimates by the World Steel Association. Volumes in Europe were up 5.9%, but growth elsewhere has been "more muted", the company said.

Meanwhile in the foundry market, market conditions across the globe remain mixed. "Although the automotive industry has indicated that truck and light vehicle production has increased in Europe and North America, volumes in Brazil and India have been weaker, and there has been no improvement in the low levels of investment in the mining end market."

Vesuvius said it continues to expect the underlying trading environment in 2014 to be "broadly similar to that experienced in 2013", while the current strength of sterling will continue to have a negative impact on reported results.

"We are making good progress with our self-help initiatives to drive performance improvement regardless of the wider market environment, with margin improvement continuing in 2014," Vesuvius said.

The stock was 0.8% higher at 448.7p by 10:27.

BC

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