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Meggitt profits impacted by Covid-19 travel restrictions
2nd Jul 2020 08:34
(Sharecast News) - Engineering company Meggitt warned on Thursday that first-half profits were set to fall due to impacts stemming from coronavirus-related travel restrictions.
The engineer said that revenues for the six months ended 30 June were forecast to fall by around 15% year-on-year, mostly driven by the performance of its civil aerospace unit, which makes up around half of the group's total sales.
The FTSE 250-listed group also cautioned that revenues in its energy division were predicted to be down, while income from its defence unit, which makes up 36% of total group sales, was expected to rise 1-5%.
Meggitt said it had made good progress in delivering cost-saving measures and highlighted that the "significant" free cash outflow seen over the first half of 2020 would be offset by the sale of its training systems subsidiary for $146m.
"The reduction in our global workforce is proceeding as planned and, as a result of the early actions taken in the first quarter, we anticipate being able to derive higher savings than originally planned from reducing our discretionary operating costs," said Meggitt.
As of 0830 BST, Meggitt shares were up 5.64% at 322.30p.
The engineer said that revenues for the six months ended 30 June were forecast to fall by around 15% year-on-year, mostly driven by the performance of its civil aerospace unit, which makes up around half of the group's total sales.
The FTSE 250-listed group also cautioned that revenues in its energy division were predicted to be down, while income from its defence unit, which makes up 36% of total group sales, was expected to rise 1-5%.
Meggitt said it had made good progress in delivering cost-saving measures and highlighted that the "significant" free cash outflow seen over the first half of 2020 would be offset by the sale of its training systems subsidiary for $146m.
"The reduction in our global workforce is proceeding as planned and, as a result of the early actions taken in the first quarter, we anticipate being able to derive higher savings than originally planned from reducing our discretionary operating costs," said Meggitt.
As of 0830 BST, Meggitt shares were up 5.64% at 322.30p.