AEROSPACE supplier Meggitt, which has large operations in Coventry and Birmingham, has announced improved full year results based on the continuing buoyancy of its principal sector.
In keeping with similar recent announcements from Midlands manufacturers such as GKN and Avingtrans, the company said the civil aerospace sector was providing many opportunities for growth.
This was likely to continue during 2014 giving rise to optimism for a second successive year of strong growth.
Full year results for the year ended December 31, 2013 show total revenue grew 2% to £1,637.3m (2012: £1,605.8m), with underlying profit - the group's preferred measure of trading performance - growing by 1% to £397.2m (2012: £392.1m).
Underlying pre-tax profit increased by 3% to £377.8m (2012: £366.0m), with a 7% rise in final dividend to 8.80p. This latter figures represents a total dividend for the year of 12.75p (2012: 11.80p), an increase of 8%.
It said: "With further growth in deliveries of large jets at Airbus and Boeing, and an order backlog of greater than seven years at current production rates, we are confident in the continued growth outlook for large jets.
"Deliveries of regional aircraft increased by 11% in 2013 with further growth expected over the medium term, driven by demand for 70 to 90 seat aircraft. Total business jet deliveries decreased in 2013, but there was good growth in deliveries of super-mid size and long-range aircraft, where our products are concentrated. We anticipate further growth in this segment over the medium term."
Its Coventry operation, part of Meggitt Aircraft Braking Systems (MABS), is involved in the supply of wheels, brakes and brake control systems. It provides 20% of group revenue.
MABS civil aftermarket revenue (65% of divisional total) grew by 3% in 2013 with growth in regional aircraft and large jets offsetting a modest decline in business jets resulting from a significant destocking at one of the group’s major customers. Civil original equipment saw strong growth, mainly from the sale of electronic brake control systems and A380 components. Military revenue saw a modest increase owing in part to good growth in Blackhawk spares for the US Department of Defense. Operating margins moved from 37.6% to 37.0% reflecting the growth in lower margin civil OE sales.
Stephen Young, Meggitt chief executive, said: "The group achieved continued growth in revenue and underlying profit despite some operational and end market-related challenges. The Meggitt Production System, launched in 2013, has made an excellent start, and we are already starting to see improvements in quality and delivery in a number of our businesses.
"We have emerged from an intensive bid cycle resulting in technology sales into a significant number of new aircraft programmes. Many involve a full suite of Meggitt capabilities, exceeding the shipset content of their predecessors, and the resulting high level of investment in product development and capacity expansion will serve to deliver further good growth in 2014 and beyond.
"As a sign of our continuing confidence in the prospects for the group, we are recommending an increase in the full-year dividend of 8%."
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