GKN sales up 11% but group wary over fragile economy
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The British automotive and aerospace group GKN has said that it expects to benefit from growth in global car production, particularly in India, and increases in Airbus and Boeing production. However, the company warned that there remained some uncertainty around macro-economic conditions in its half year update.
In automotive, GKN said that external forecasts suggested that global light vehicle production should reach almost 78 million vehicles in 2011, an increase of 4%, with the strongest growth in India, continuing improvement in North America and Europe and slower growth in China. Vehicle production in Japan is expected to recover strongly in the second half.
In aerospace, US military aircraft market demand is expected to show a small reduction as a result of the rundown of the F-22 and the decrease on the C-17 programmes. Civil aircraft demand is expected to continue to grow in 2011 as both Airbus and Boeing increase production schedules.
In the first half of the year, GKN reported sales up 11% to almost £3bn while trading profit of £247m was up by £45m.
Chief executive Sir Kevin Smith (pictured) said GKN's Driveline, Powder Metallurgy and Land Systems businesses had outperformed the market. He went on: "The aerospace market has remained subdued although civil aerospace is now moving into a strong growth phase with volume increases on existing platforms and new aircraft moving into production.
We are also pleased to further strengthen our Driveline and Land Systems businesses with two highly complementary acquisitions in Stromag and Getrag Driveline Products.
"GKN's excellent global market positions, strong order books and leading technology leave us extremely well positioned for sustainable growth and further margin expansion."
