GKN plc has reported its results for the year ended 31 December 2014, showing organic sales for the group increased by £303 million (4%) to £7,456 million. Organic trading profit increased £66 million to £687 million (11%) over the previous year. Group trading margin increased to 9.2% (2013: 8.7% or 9.0% excluding restructuring charges).
“This was another good performance, particularly in our automotive businesses, with GKN Driveline delivering 8% organic sales growth and an 8.1% trading margin while GKN Powder Metallurgy achieved an 11.0% margin. GKN Aerospace delivered another good result. We have continued to outperform our key markets and report good underlying financial results in spite of sterling’s strength and some end market weakness, particularly in Land Systems. Looking forward we expect 2015 to be another year of growth,” stated Nigel Stein, Chief Executive of GKN.
GKN Powder Metallurgy
GKN Powder Metallurgy comprises GKN Sinter Metals and Hoeganaes. Organic sales at GKN Powder Metallurgy for 2014 were reported as £916 million. Good growth was achieved in North America, China and Europe but sales in South America fell due to weaker automotive and industrial markets.
The organic increase in profit was £13 million, including the absence of £5 million of restructuring charges reported in 2013. The impact of currency translation was £6 million adverse (7%). The divisional trading margin was 11.0% (2013: 10.1%, or 10.6% excluding restructuring charges), reflecting the move towards higher value “design for powder metallurgy” parts.
GKN Powder Metallurgy continued its strong product and development activities in engines and transmissions, being awarded £165 million of annualised sales in new and replacement business. It also won a number of quality awards including: Excellent Supplier Award and Zero PPM 2014 Award from GETRAG (Jiangxi) Transmission Co., Ltd.; and four Supplier Quality Excellence awards from General Motors.
Reflecting its move into more advanced applications of powder metal technologies, GKN Powder Metallurgy stated that it is expanding its facilities in North America with more complex and efficient tooling and presses. It has signalled its commitment to the Chinese market with the expansion of its two production facilities there and also announced a technology collaboration agreement with McPhy Energy to develop solid state hydrogen storage solutions.
During the year, Hoeganaes made progress in the development and commercialisation of high technology powders for Additive Manufacturing. For example, highly alloyed tool steels, nickel based alloys and specialised stainless steel powders have been developed and the first commercial shipments made. Early development work also progressed on titanium powders for additive manufacturing. A new research titanium atomiser is currently being installed at the Powder Innovation Centre in the USA and will be commissioned during the first half of 2015.