Melrose Industries PLC Trading Statement AGM (6926X)
06 Mayo 2021 - 01:00AM
UK Regulatory
TIDMMRO
RNS Number : 6926X
Melrose Industries PLC
06 May 2021
6 May 2021
MELROSE INDUSTRIES PLC
AGM Trading Statement
Melrose Industries PLC ("Melrose" or the "Group") publishes the
following trading update for the four months from 1 January to 30
April 2021 (the "Period") ahead of its Annual General Meeting
taking place later today. All numbers are calculated at constant
currency.
Group and cash generation
Melrose is trading modestly ahead of expectations.
For the Melrose Group, the momentum seen in the second half of
2020 has continued into 2021, with sales in the Period being 8%
higher than in the same period in 2020. Excluding Nortek Air
Management, Group sales grew by 4%.
The operating margins achieved in the first quarter of the year
continued to improve faster than expected and cash generation for
the Group is encouraging, with Melrose being cash neutral in the
first quarter, in what is traditionally a cash outflow period.
The Melrose Board is encouraged by the start to the year and
expects the improvements will continue, albeit the growth rate will
be impacted to a degree by the well publicised supply issues on
semi-conductors in the global automotive supply chain.
Aerospace
In the Period, as expected, Aerospace continued the sales trends
seen last year with defence growing and civil significantly down.
In the Period, sales were down 27% compared to the same period in
2020 and 33% on 2019. Encouragingly, Aerospace made a modest profit
in the first quarter of 2021 at a demand level that was loss making
last year. This provides strong evidence that the numerous cost
saving, and improvement projects are starting to have a positive
impact. On 31 March 2021 Fokker Services BV and Fokker Techniek BV
were sold for a nominal sum, in 2020 these businesses had sales of
c.GBP140 million and were approximately breakeven.
Automotive
Automotive sales in the Period were 28% up compared to the same
period in 2020, and 13% below 2019. This is consistent with the
market demand recovering, but with a deferred impact on growth
rates due to the impact of the semi-conductor shortage in the
global automotive industry.
The Automotive margin in the first quarter was encouragingly
above that achieved in the second half of last year, which is
consistent with the improvement plans continuing to deliver
benefits.
Powder Metallurgy
Powder Metallurgy has seen a strong recent trading performance
with sales in the Period being up 35% compared to the same period
in 2020 and also up 1% on 2019 with margins in the first quarter
significantly higher than those achieved in the second half of last
year and also higher than the same period in 2019. Powder
Metallurgy is gaining market share and improving its operations,
both of which are trends expected to continue.
Nortek Air Management
Nortek Air Management continued to perform well in the first
quarter of the year with sales up 28% on last year and 27% up on
2019, continuing the momentum seen in the second half of last
year.
The Melrose Board is delighted to have exchanged contracts on
the sale of Nortek Air Management with Madison Industries for
$3.625 billion, as announced on 19 April. The completion of the
sale process is proceeding as expected, following which the details
will be announced for the proposed portion of the proceeds to be
returned to shareholders.
Other Industrial
The Other Industrial division also continued to trade well in
the Period with sales 12% up on 2020 and 12% down on 2019. The
margin achieved in the first quarter was up on the same period in
2020.
Investor Day
Melrose will be holding an Investor Day about the Automotive and
Powder Metallurgy divisions on 20 May, starting at 2.15pm, to
explain in more detail the improvement, growth, and exciting new
technology opportunities in these businesses.
Simon Peckham, CEO of Melrose Industries PLC, said:
"We are pleased with our start to the year and hopefully will
see this momentum continue for the rest of the year. We are
encouraged by the significant improvements made to the GKN
businesses being reflected in their financial performance. We are
confident that GKN will be as successful as previous acquisitions,
a track record illustrated recently by the announced sale of Nortek
Air Management."
-ends-
Enquiries:
Montfort Communications: Nick Miles
+44 (0) 20 3514 0897
+44 (0) 7739 701 634
miles@montfort.london
Charlotte McMullen
+44 (0) 20 3514 0897
+44 (0) 7921 881 800
mcmullen@montfort.london
Melrose Investor Relations: Chris Dyett
+44 (0) 7974 974690
ir@melroseplc.net
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