31st Jul 2014 08:19
LONDON (Alliance News) - Bodycote PLC Thursday posted a decline in revenue but a rise in pretax profit for the first half of 2014, adding its name to the list of UK companies to blame the strong pound for hurting its results.
Revenue declined 1.3% to GBP312.3 million in the six months to June 30 from GBP316.5 million in the same period a year earlier. The FTSE 250-listed thermal processing services firm said revenues were up 4.6% on a constant currency basis.
Pretax profit rose by 8.5% to GBP52.6 million against GBP48.5 million a year earlier, despite the company taking a GBP3.2 million hit from foreign-exchange movements.
The firm will pay an interim dividend of 4.6 pence, up from 4.4 pence the year before.
It said that while the group performed well in the first half, the impact of currency movements impacted its organic growth and margin improvement. It said that as it has limited forward visibility, it expects further progress this year on a constant currency basis.
Bodycote said its Speciality Stainless Steel Processes and Hot Isostatic Pressing Product Fabrication Technologies provided a boost to its performance, combining with mix improvement, in particular in emerging markets, which led to a further expansion of its headline operating margin to 18.0%.
The company said market changes in the oil & gas sector were moving in its favour, in particular as regards its HIP PF technology. It also said that a combination of original equipment manufacturer supply chain structural changes, inventory adjustments, and lower defence spending was holding back growth in the aerospace sector.
In automotive, the company said it was performing well and was winning more business in providing thermal processing services for a number of customers, focusing on car and light truck production.
Bodycote shares were up 1.5% to 703.50 pence in early trade Tuesday.
By Sam Unsted; [email protected]; @SamUAtAlliance
Related Shares:
Bodycote