Buoyant aerospace sector contributes to record results for Avingtrans
MANUFACTURING group Avingtrans, fresh from announcing record full year results, has said it remains optimistic about growth after seeing strong demand across its aerospace businesses.
The Midlands-based group, which designs, manufactures and supplies critical components, modules and associated services to the aerospace, energy and medical sectors, has seen revenue for the full year to May 2013 grow 40% to £45.3m (2012: £32.2m).
Aerospace grew more than 70% over the year, lifted significantly in the second half by two acquisitions – Aerotech and PFW – and the on-going positive trends in civil aerospace. It said Energy & Medical saw more measured organic growth of 7%, with the initial ramp up of the new Siemens product generating some of this increase.
Aside from revenues, adjusted EBITDA on continuing operations was up by 50% to £3.6m (2012: £2.4m). Aerospace profits were suppressed both by on-going losses at its Composites operation, which had been expected and by low initial profits at the new Farnborough operation. Profit improvement at Energy and Medical was anaemic, held back by a poor performance from its Crown operation, although this was much less than previously.
Gross margins improved in the second half, up to 26% for the year (2012: 24%). Adjusted pre-tax profit also increased markedly, up by nearly 90% to over £1.9m (2012: £1.0m). Earnings per share rose by 80%.
In outlook, it said the transformation of the group into a niche engineering market leader was progressing to plan. Attractive structural growth markets and durable customer relationships were the main cause of optimism.
“The improving world economic outlook can only help our development and we are optimistic about our prospects in this financial year and beyond. Prospects for Civil Aerospace and Energy in particular, are exciting,” it said.
The growth strategy is producing significant new business wins and it said provided good visibility of longer term earnings.
“We have an excellent customer base to work from and various differentiated product niches to develop that offer a degree of protection to cyclical markets. We are increasingly well placed to benefit from any further consolidation in our markets.
“With the three recent acquisitions, we again signalled our intention to build shareholder value through targeted M&A activity. Whilst we cannot state that this will result in any further transactions during the current financial period, we will forcefully pursue any opportunity to enhance long-term value,” it added.
The Sigma and Aldridge-based Metalcraft businesses are said to be developing into clear market leaders and a growing presence in China was adding to its competitive advantage.
