Avingtrans posts jump in half-year earnings

Avingtrans, which designs components for the aerospace, energy and medical sectors, saw profits rise in the last half of 2012 as the company made strategic acquisitions and shaved weak assets.

Profit after tax climbed to £6.5m for the six months to the end of November, compared to £0.7m in the first half.

However, the company said the figures were distorted by the sale of Jena Tec, a manufacturer and repairer of ballscrews, machine tool spindles and linear motion components.

Jena Tec was sold to Kuroda of Japan in November for a cash consideration of £12.4m.

The transaction reduced the company's net debt of £8.4m in May to £0.3m at the end of the second half. It also allowed the company to focus on its business in the aerospace, energy and medical sectors.

During the period the group acquired Aerotech Tubes, which manufactures pipework systems for aerospace, for £1.9m, net of cash. It contributed £56,000 to group revenues and £4,000 to profit after tax.

Overall revenue from continuing operations increased 19% to £16.9m as the order book remained at record levels boosted by aerospace business which saw revenues climb 25%.

Earnings before interest, tax, depreciation and amortisation grew slightly, from £1.0m in the first half to £1.1m.

Chairman, Roger McDowell, said: "Whilst the word transformation is overused in business terms it undoubtedly summarises the events at Avingtrans over the last few months.

"(...) As a result we have a market leading position in the aerospace pipes niche and have recently secured three key long term agreements with major clients worth £125m of revenue over the next 10 years.

"With this strength of visibility we have once again concluded that we can commit to the payment of an enhanced dividend with the final results this year, rewarding our loyal investors for their continued support."

The firm will reinstate an interim dividend of 0.7p per share compared to zero return in the previous period.

RD