16th Oct 2018 07:57
LONDON (Alliance News) - Meggitt PLC on Tuesday upgraded its revenue guidance on a stronger than expected performance in its core civil aerospace and defence business divisions and improving market conditions, particularly US defence spending.
The FTSE 250-listed engineering business now expects 2018 total organic revenue growth of between 7% to 8%, up from 4% to 6% seen previously. Annual operating margins guidance remains unchanged and is expected to be towards the lower end of the 17.7% to 18.0% range.
Meggitt said growing demand for business and large jets led to 5% revenue growth for original equipment - part of civil aerospace division - for the three months to the end of September. Full year organic revenue growth from the civil aerospace division is now expected between 6% to 8%, up from previous 2% to 4% estimates.
Civil Aftermarket revenue grew by 9% in the quarter due to further growth in air traffic and low levels of aircraft retirements, increasing spare parts demands. The division in now predicted to record full year organic revenue growth of between 7% to 9% versus previous guidance of 4 to 6%.
In Defence, continued demand for retrofit fuel tanks led to 8% organic growth in the quarter. The unit is expected to record full year organic revenue growth of 7% to 9%, up from 6% to 8% expected previously, partly due to a continued positive outlook for US defence spending.
The company, however, recorded 9% drop in third quarter organic revenue for its energy unit due to declining power generation revenue and against stronger prior year comparatives. Meggitt continues to anticipate full year organic revenue growth in excess of 5% in its energy business.
Related Shares:
MGGT.L