Bodycote predicts return to health in 2010

INDUSTRIAL group Bodycote has said that while it still faces a rocky year, first quarter performance was strong and it expects full year operating profits to be ahead of analyst expectations.

The Macclesfield-based company, which heat treats metals for use in sectors such as automotive, aerospace and defence, said first quarter revenues to the end of March had continued to improve month on month, and were 7.8% higher than in the final quarter of 2009.

First quarter operating profits were “significantly improved” on a year ago, it added, because cost savings from its restructuring  – which saw  it cut more than 1,000 jobs and close 25 facilities last year – were higher than forecast.

The company posted an annual loss of £54.5m for 2009, as it was hit by a slump in revenues and costs from its restructure. Revenues fell from £551.8m to £435.4m, while headline operating profits slumped to £8m from £71.2m.

Looking ahead, the company said that while the future remained rocky, particularly in the second half of the year, it did expect full year operating profits to be at the upper end of forecasts, which range from £26.8m to £34.7m.