GKN owner Melrose reports strong revenue growth
Melrose Industries, which bought historic engineering firm GKN earlier this year, said it was trading in line with its expectations for 2018.
In a trading update for the four months through to October, Melrose reported "strong revenue growth" in its aerospace and powder metallurgy sectors during its latest financial period.
However, the listed company added that revenue in its automotive division was flat in the period from July 1 to October 31.
GKN has a wheels and structures plant at the Hadley Castle Works in Telford, as well as other factories dotted around the Midlands, with about 1,000 workers.
Melrose said it remains "confident the GKN businesses offer an outstanding opportunity for value creation over the medium term."
Good progress had also been made for on margin, including improvement in the performance of North America, it added.
Power metallurgy revenue grew nine per cent, with improved margins, giving the company confidence that a 14 per cent margin target could be achieved in the medium term.
Improvements
In automotive, margins shrunk as revenue remained flat. Melrose, however, said remained confident that operational improvements were achievable and would improve performance in 2019 and beyond.
"Melrose has a proven business model, which has been successful over many years and through several economic cycles," said chairman Christopher Miller.
"We are confident that there is an outstanding opportunity to make significant and lasting improvements to the performance of the GKN businesses.
"Whilst certain end markets may be unpredictable, the group is on track to meet our expectations for this year.
"We are excited by the future prospects of the group and look forward to delivering significant value for shareholders."
Liam Butterworth was appointed chief executive of the automotive division on November 5.
Melrose’s takeover of GKN sparked intense anger from unions and politicians.
Its victory earlier this year brought to a close a bitter battle that had raged for months, with unions and MPs warning over job cuts, asset-stripping and national security concerns throughout the takeover saga.
