Smiths Group has reported falling profits in its aerospace business caused by the slack civil aerospace market.
"Demand is likely to remain at these lower levels for some time," the company says in its results for the year to 31 July 2002. Strong sales of defence and detection systems helped, but profits were still down to £191 million ($298 million) from £209 million in 2001. Smiths hopes defence sales will grow - it supplies around $1 million worth of avionics to each Eurofighter Typhoon, production of which is accelerating.
The company netted £247 million from disposals, which helped reduce net debt from £1.12 billion to £725 million - the company's gearing is now only 20%.
Smiths Group includes aerospace, medical, sealing and industrial operations. Aerospace represents 44% of its £3.07 billion sales and 42%of its £406 million profits. Over half of its revenues come from the USA, where it is a tier 1 supplier on such projects as the BoeingF/A-18E/F Super Hornet and 777 airliner, and the Lockheed Martin C-130, F-16, F/A-22 Raptor and F-35 Joint Strike Fighter. But the company says it can maintain performance if defence, healthcare and biological/chemical detection sales remain strong.
Source: Flight International
