Hampson issues profit warning as order problems are highlighted

BLACK Country aerospace group Hampson Industries has warned the market that its annual profits will be “materially lower than prior expectations” after it identified problems with its largest tooling order.

In an interim management statement issued in February Hampson said “issues had been identified during the testing and customer approval process for the group’s largest tooling order which meant that some deliveries were expected to move from fiscal year April 2011-March 2012 to fiscal year April 2012-March 2013”.

As a result it is now estimating that its operating profit for April 2011- March 2012 will be lower than previously predicted.

“This is principally due to the expected delay in deliveries occurring and to both higher than previously anticipated costs as a result of these issues and a reassessment of future costs to complete the order,” it said in its statement.

“The final outcome is dependent on the conclusion of the technical and commercial discussions with the customer.”

In the interim management statement, the board also announced that it believed it to be prudent to “review actively all financing and strategic options, including a sale of the group and it therefore announced the commencement of a formal sale process”.

It said discussions are continuing with a number of parties with regard to a potential sale of the group.

Hampson first announced it was up for sale in an announcement to the London Stock Exchange in February.

The firm had been in difficulties for some time due to the decline in the aerospace sector globally and problems within a major US acquisition.