Volvo Aero contribution powers up GKN first-half results

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GKN Aerospace's first-half sales and profit surged on the back of its £633 million ($969 million) acquisition of the Volvo Aero engine components business in October 2012.

That deal - described by GKN as "transformative" - lifted first-half sales by 43%, dwarfing 3% organic growth, to take revenue to £1.12 billion ($1.72 billion).

Trading profit was up 37%, at £118 million. Volvo Aero, now trading as GKN Aerospace Engine Systems, contributed £37 million profit, wiping out a £7 million decrease in existing businesses, hit by lower military spares sales on mature programmes and some decline in new programmes.

For the aerospace division broadly - which now accounts for 29% of GKN group sales, second only to the automotive driveline division - commercial sales now account for 71% of business. There were up 8% in the half, driven by contributions to the Airbus A320, A330 and A380 and Boeing 787 programmes.

Second-half sales, excluding the impact of Engine Systems, are expected to be on a par with last year, but profit should be boosted by ramp-up of new programmes. GKN ships some $3 million-worth of material to every 787, and just shy of that to the Airbus A350 (see below).

Shipset values by programme at GKN

 

 Source: GKN