Meggitt's pre-tax profits rise in the first half on higher revenues

6th Aug 2013 07:03

Meggitt's pre-tax profit for the first half rose 7.0 per cent to 182.4m pounds, bolstered by the engineering company's strong performance in civil original equipment (OE) and energy markets.Revenue for the first six months of the year jumped 4.0% to £810.1m compared to a year ago while underlying earnings before interest, tax, depreciation and amortisation (EBITDA) increased 6.0% to £233.1m.The company, which specialises in high performance components and sub-systems for the aerospace, defence and energy markets, said anticipated weakness in civil aftermarket and military was offset by robust civil OE and energy revenues.Military revenues declined by 1.0% on a proforma basis, due to ongoing troop drawdowns and fiscal pressures facing a number of customers. The outlook for defence expenditure in the US, the group's single most important military market, remains uncertain. Energy revenues increased by 22% on a proforma basis in the first half, boosted by strong demand for printed circuit heat exchanger products being a significant driver of this growth. Civil aerospace revenues grew 6.0% on a proforma basis, with strong growth in large jets delivering proforma OE growth of 15%. Meggitt said deliveries of large jets by Airbus and Boeing are underpinned by a firm order backlog stretching out for a number of years, providing confidence in the continued growth outlook for OE. Stephen Young, Chief Executive, said: "The business delivered top line growth in line with our expectations in the first half, with particularly strong performances in the civil OE and energy markets. Military held up well given the challenging budgetary environment, and we have seen a modest recovery in the civil aftermarket in the second quarter. "The work we are undertaking as part of the raising the bar programme, focusing the group on achieving world-class operations and programme management, underpins our confidence in delivering further strong growth."The company raised its interim dividend by 10% to 3.95p, reflecting an upbeat outlook.RD