Bodycote Declares Special Payout Amid Market Beating 2017 Growth

6th Mar 2018 08:49

LONDON (Alliance News) - Bodycote PLC declared a special dividend Tuesday after 2017 profit and revenue grew strongly and ahead of its market, while trading has begun 2018 in line with expectations.

Bodycote - a FTSE 250-listed metal processing company - proposed a 25.0 pence special dividend for 2017. This is in addition to hiking its full-year ordinary dividend 10% to 17.4p from 15.8p the year before. The final dividend was increased to 12.1p from 10.8p the year before, up 12%.

In 2017, pretax profit expanded 27% to GBP117.0 million from GBP91.9 million the year prior. This was after revenue rose 15% to GBP690.2 million from GBP600.6 million the year before. In constant currency, revenue grew 9.6% which Bodycote described as "well above the background market growth rates".

Bodycote's largest Automotive & General Industry unit saw revenue grow 19% to GBP417.1 million from GBP349.7 million the year before. Operating profit widened 27% to GBP74.2 million from GBP58.5 million.

Aerospace, Defence & Energy revenue grew 8.9% to GBP273.1 million from GBP250.9 million the year before. Operating profit expanded 16% to GBP64.2 million from GBP55.6 million in 2016.

"2017 has once again demonstrated the quality of Bodycote's business," Bodycote Chief Executive Officer Stephen Harris said. "Strong growth was achieved through contributions from contract wins on automotive and aerospace programmes, excellent growth in Emerging Markets (where our investments are yielding good returns), and broad-based growth across the general industrial sectors, an element of which was due to some customer restocking."

"The group's revenue growth, combined with continued discipline on costs, helped lift headline operating profit by 24%," Harris added. "Return on sales increased to 18.0% from 16.6%."

"To ensure that the business continues to deliver good results, we will continue to focus on efficiency, maintaining price discipline in light of increasing inflation across many economies, and the execution of our successful strategy," Harris continued.

"Our business, by its nature, has limited forward visibility, but we have entered the year with good momentum," Harris concluded. "Accordingly, and in spite of the foreign exchange headwind at current exchange rates, 2018 has started in line with our expectations."

Shares in Bodycote were 3.8% higher at 945.50 pence on Tuesday.

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