GKN reports positive results and anticipates sustainable growth
March 1, 2011
GKN plc, the global engineering group with head quarters in the UK, has reported strong growth in 2010 with profit of £411 million and sales across the group growing 22% to £5.4 billion for the year.
“GKN has continued to make strong progress in financial performance and in building the future of our global market-leading businesses.” stated Sir Kevin Smith, Chief Executive of GKN plc. “The trading environment has seen an improving trend for GKN’s Driveline, Powder Metallurgy and Land Systems businesses. The aerospace market has remained subdued although civil aerospace is now moving into a strong growth phase with volume increases on existing platforms and new aircraft moving into production.”
“The Group’s restructuring actions have enabled us to improve our competitiveness and margins and the continued focus on cash generation has resulted in a halving of net debt. GKN’s strong market positions and leading technology and the conclusion of restructuring leave us extremely well positioned for sustainable growth and margin expansion.” added Smith.
Hoeganaes and GKN Sinter Metals sales up 48%
GKN’s Powder Metallurgy group includes metal powder producer Hoeganaes and sintered products manufacturer GKN Sinter Metals. Hoeganaes is the largest producer of metal powder in North America and GKN Sinter Metals is the world’s largest manufacturer of sintered components.
Overall, sales in the Powder Metallurgy division were up 48% to £759 million from £512 million in 2009. Sales increased in all regions as automotive markets recovered and recent new business wins entered production. This resulted in a trading profit of £54 million for 2010, against a loss of £7 million in 2009.
Underlying sales for GKN Sinter Metals increased by 43%, with strong growth achieved in North America, Europe, India and Brazil. Hoeganaes’ total tons shipped were 46% higher than in 2009 and underlying sales were 76% higher, the difference reflecting an increase in the commodity metals surcharge passed on to customers as raw material prices increased.
A new powder mixing and finishing facility was opened by Hoeganaes, in China, towards the end of the year, to support growth in that rapidly expanding market.
Increasing trends in industrial and automotive markets to improve fuel efficiency and reduce emissions, such as variable valve timing in engines, high performance gear sets in automatic transmissions and differential gears, are driving the demand for products made by powder metallurgy, stated the company.
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