28th Jul 2015 06:31
LONDON (Alliance News) - FTSE 100-listed engineer GKN PLC on Tuesday said its pretax profit declined in the first half of the year, hit by continued weakness in some of its key markets, and said it has agreed a EUR706 million deal to acquire Fokker Technologies Group BV.
The company, which manufactures components for the aerospace, automotive and industrial sectors, said its pretax profit for the six months to the end of June was down to GBP212 million from GBP224 million a year earlier, despite an increase in sales for the group to GBP3.62 billion from GBP3.57 billion.
Chief Executive Nigel Stein said trading had been solid in GKN's automotive business and said its aerospace franchise performed in line with its expectations, but it has seen continued weakness in some end-markets, particularly oil and gas, which has hit its GKN Land Systems unit. Stein said the company expects these trends to continue into the second half of the year.
GKN said it would pay an interim dividend of 2.9 pence, slightly up from the 2.8 pence it paid a year earlier.
In a separate announcement, the group also said it will pay EUR706 million to acquire Fokker Technologies, a Dutch maker of aerostructures, electrical wiring systems, landing gear and associated services. GKN said the deal will strengthen its position in the aerospace market and will expand its presence in the Chinese, Turkish, Indian and Mexican markets.
GKN will partly fund the deal via a GBP200 million equity issue, which will be run by JPMorgan Cazenove and UBS Ltd. The price per share will be determined at the close of the accelerated bookbuild, GKN said.
By Sam Unsted; [email protected]; @SamUAtAlliance
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