Hampson Industries stays cautious on prospects

BLACK Country aerospace group Hampson Industries has said it remains cautious about its expectations for the current year and has not ruled out further disposals as it looks to reduce debt levels.

In an interim management statement, the company said net debt as of January 31 this year was £99m, an increase of approximately £10m since the half year.

It said the increase was in line with management forecasts and was the result of normal phasing differences between the receipt of contracted progress payments from customers and working capital investment in large tooling contracts.

“The reduction of net borrowings remains a key strategic priority for the group and, in this regard, the board has previously indicated that selective asset disposals may be pursued,” said the statement.

“Whilst it is premature to assess whether acceptable value can be realised from such an exercise, the board has made progress in this regard and anticipates being in a position to make a final decision in the relatively near term.”

The company, which last year issued a major profit warning after orders stalled, also said that its restructuring initiatives were ongoing and would hopefully enable the firm to turn the corner.

In outlook, it said: “Further to the major operational changes, the board considers it appropriate to remain cautious about the group’s expectations for the 2010/11 financial year.  

“Recognising these issues, the board expects that the identified initiatives that are currently being implemented will lead to steadily improving performance in 2011/12.”

The body of the statement suggested the company may be better positioned for medium to long term growth.

In its Aerospace Composites & Transparencies operation, the firm said market conditions in aerospace tooling had remained largely unchanged since the time of its half year report.  

It said despite programme delays, large tooling opportunities continued to exist, most notably on the Boeing 787-8 and B787-9 projects together with the Airbus A350, CH-53 and Lockheed Martin Lightning II (Joint Strike Fighter) programmes.

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