Half year losses grow for GKN owner
The group that owns GKN saw its pre-tax loss grow in the six months to the end of June.
Melrose Industries went from a loss of £131 million a year before to £560m on revenue down from £5.5 billion to £4.1bn.
It said trading over the summer months has been at the higher end of the board's expectations, particularly in automotive and key markets for its Nortek air management business,
Improved banking terms have been agreed with the Melrose lending bank syndicate, giving the flexibility if required over the medium-term to continue to improve the businesses
Restructuring projects are well underway that will improve the group's trading performance by more than £100m next year. More cost saving projects are to come and there are substantial margin improvement opportunities across the GKN businesses, which include its wheels and structures plant at the Hadley Castle Works in Telford.
The board does not consider it appropriate to pay an interim dividend to shareholders this year.
Sales in aerospace reduced by 18 per cent in the half year, but defence, which makes up around a third of the business, continued to grow.
Chairman Justin Dowley said: "These are extraordinary times which we have addressed with rigorous cash management and decisive restructuring actions; recently, and encouragingly, we have started to see trading improving in some key end markets. Crucially, we own good businesses with significant improvement opportunities and have an experienced management team with an excellent track record.
"We have delivered good returns in tough times before and as we continue to make the strategic changes needed to position our businesses within their changed market environments, we are confident of doing so again."
