Bodycote enjoys ‘excellent’ civil aerospace growth

Macclesfield-based engineering and thermal processing giant Bodycote said on Friday it enjoyed excellent growth in civil aerospace revenue in the first four months of 2019, “offset by anticipated weakness in automotive and general industrial revenues …”

In a trading update for the firm’s AGM, Bodycote said revenue for the four months ended April 30 was £245 million, 1% higher than the same period last year.

Bodycote said it will pay a final dividend of 13.3p and a special dividend of 20p on June 7, 2019, at a cost of £64 million.

“Aerospace and defence revenues grew 15%, with the strong growth trend seen through the second half of last year continuing into 2019,” said Bodycote.

“Automotive revenues fell 4%, with car & light truck revenues negatively impacted by lower production volumes, particularly in Western Europe.

“Year on year growth comparisons in car & light truck are somewhat skewed, however, as the first half of 2018 was particularly strong due to manufacturers accelerating deliveries ahead of the introduction of the WLTP regulations. 

“General industrial revenues were 6% lower, with good growth in the emerging markets more than offset by weakness in the developed economies.

“The revenue declines in the developed markets are due to the impact of business that was discontinued in H2 2018, as well as what appears to be some hesitation in customers’ capital investment decisions.   

“Energy revenues were broadly flat, with stronger revenues from subsea projects offsetting a decline in North American onshore oil & gas revenues as a result of customer destocking.”

In its outlook, Bodycote added: “In the first four months, we have seen excellent growth in civil aerospace revenues, offset by anticipated weakness in automotive and general industrial revenues against strong comparatives from the same period last year.  

“The full year outlook for civil aerospace remains strong, and revenue growth for Specialist Technologies’ is also expected to be good.

“With easing comparatives in automotive in the second half of the year, and provided current macroeconomic conditions do not deteriorate, year on year growth should strengthen.

“The board’s expectations for the full year remain unchanged.”