Meggitt delivers positive set of results for 2012

Meggitt, the FTSE 100 global engineering group, posted an upbeat set of results for 2012, with revenue and profit up, net debt lower, and a 12 per cent increase in the dividend.

Underlying pre-tax profit for the year came in at £362.8m, up 12% from £323m the previous year, on revenues of £1,605.8m (2011: £1,455.3m).

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) climbed 9.0% to £468.4m from £428.5m the previous year. Earnings per share (EPS) totalled 36.2p, up from 31.9p.

On a statutory basis, profit before tax came in at £292.1m (2011: £226m), while EPS rose from 24p to 31.1p year-on-year.

Net debt fell to 642.5p from 788.4p at the end of 2011, a decline of 19%.

The dividend was increased from 10.50p by 11.80p.

Outgoing Chief Executive Terry Twigger said: "Our business grew strongly in 2012, with revenues up 10% and underlying earnings per share up 13%. PacSci is trading well and we are raising our synergy target again. Our operational improvement initiative is off to an excellent start. We look forward to further good growth in 2013 and beyond.

"As a sign of our continuing confidence in the prospects for the group, we are recommending an increase in the full-year dividend of 12%."

Divisionally, Civil and Military revenue both climbed 7.0%, while energy revenue leapt 45% on the back of heightened demand for Meggitt's printed circuit heat exchangers.

Looking ahead, organic revenue is expected to grow between 6-7% on average over the medium term, with mid-single-digit growth in 2013.

"The outlook for our civil markets remains good, with further growth in aircraft deliveries anticipated in 2013 and beyond," the company said.

"Growth in commercial air traffic is expected to continue, and the link between traffic growth and aftermarket revenues is expected to normalise during the course of 2013, providing a positive outlook for our civil aftermarket revenues.

"In the military market, uncertainties around US DoD spending persist as the potential for sequestration of the defence budget remains. As such, while we remain confident in delivering an average compound organic growth rate of c2% in military over the medium term, we anticipate flat military revenues in 2013 excluding sequestration. If sequestration occurs we would expect to see a modest decline in military revenues."

The share price rose 3.01% to 472.90p by 08:50 on Tuesday.

NR