GKN’s sales for the six months ended 30 June 2014 was down 2% to GBP3.56bn (US$6.04bn) compared with GBP3.64bn in the same period a year ago. Operating profit of the firm was up 59% to GBP259m compared with GBP163m. Profit before tax was up 76% to GBP224m compared with GBP127m in the year ago period. Earnings per share more than doubled to GBP0.11 from GBP0.05 in the previous year.
“This is another good performance, particularly in GKN Driveline which delivered 11% organic sales growth. We have continued to outperform our key markets and report good underlying financial results in spite of sterling’s strength and some end market weakness – we expect these trends to be maintained in the second half. GKN is continuing to make encouraging progress against its strategy,” said Nigel Stein chief executive, GKN.
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Outlook
In automotive, external forecasts suggest that global light vehicle production should grow around 3% in the second half as comparators get tougher. Increases are expected in China, North America and India, while Europe is forecast to be flat and Japan and Brazil decreasing. Against this background, GKN Driveline and GKN Powder Metallurgy are expected to continue to grow organically above the market.
The strength in Sterling will adversely affect reported results. However the group’s underlying progress is expected to continue due to the benefits of its diverse exposure to global markets, strong customer positions and healthy order books.
