GKN share price: Group releases full-year results
GKN Plc (LON:GKN) has this morning published its full-year results. Here are the highlights from the company statement with more to follow:
· Sales increased 4% organically; decline of 2% after £403 million adverse currency translation impact
· Trading margin improved to 9.2%; · Profit before tax (management basis) up 4%, after £38 million of adverse currency more than offsetting the absence of restructuring costs of £25 million charged in 2013; · Reported profit before tax was £221 million (2013: £484 million), lower primarily due to the £232 million movement on the mark to market valuation of forward foreign exchange contracts; · Earnings per share up 1%, impacted by an increased tax rate to 22% (2013: 20%); · Total dividend increased 6% to 8.4 pence per share; · Return on average invested capital of 17.7% (2013: 17.3%); · Free cash flow of £234 million (2013: £346 million), after £54 million repayment of a UK Government refundable advance and increased capital expenditure to fund future growth; · Net debt of £624 million, £108 million lower than last year.
Commercial aircraft production should continue to be strong whereas military markets are forecast to decline. GKN Aerospace’s 2015 organic sales are expected to be broadly flat, reflecting these differing trends and the phasing of our programmes. However, a strong commercial order book supports attractive growth for GKN Aerospace over the medium term.
In automotive, external forecasts predict growth in global light vehicle production of around 2% with increases in China and North America, and Europe flat. Against this background, GKN Driveline and GKN Powder Metallurgy are expected to continue to grow organically above the market.
Softer global agricultural equipment markets are likely to more than offset the slight improvement in industrial markets. As a result, GKN Land Systems 2015 sales are expected to be lower than 2014 and an £8 million restructuring charge is planned to further reduce the fixed cost base.
Although some markets remain challenging, 2015 is expected to be a year of further growth. Beyond 2015, we are well positioned to outperform in our large global markets.
As of 07:05 GMT, Tuesday, 24 February, GKN plc share price is 386.00p.