Energy markets boost Meggitt as aerospace softens

ENGINEERING group Meggitt, which has operations in Coventry and Birmingham, has said strong growth in its energy markets has helped to offset softening demand in the civil aerospace sector.

Nevertheless, in a statement covering the period from July 1 to November 1, the company said it remained confident in the long-term strength of the aerospace sector.

“Ongoing strong growth in our energy businesses, driven by excellent levels of order intake over the last 12 months, more than offset the continued softness in civil aerospace aftermarket revenues,” it said.

“We are also now starting to see the anticipated effects of the drawdown from Iraq and Afghanistan impacting our military revenues.  Against this backdrop we were pleased that our third quarter organic revenues were in line with our exceptionally strong performance in the same period last year.

“Civil aerospace end market indicators remain very encouraging, with large jet original equipment deliveries at record levels, and aircraft utilisation continuing to increase underpinned by strong load factors across the industry.  These indicators give us confidence in a resumption of aftermarket growth during 2013.”

It said increased costs savings were being achieved following the acquisition of PacSci in April 2011, while the third quarter also saw the group dispose of an environmental control systems business in North America.

“The financial position of the Group remains strong, driven by a good operating cashflow performance in the first half which has accelerated during the third quarter,” it said.

“Based on current projections, and notwithstanding the uncertainty in military end markets, the group expects to see percentage revenue growth in the mid single digits in 2013.”