Aerospace group Melrose Industries has raised its guidance for 2024 after reporting better than expected pre-tax losses amidst major board changes.
Statutory losses before tax at the FTSE 100-listed firm narrowed from £328m in 2022 to £8m in 2023 while operating profit grew from a £270m loss to a £57m profit.
The group said it is now “well-positioned” to deliver continued growth, on the back of posting £3.35bn in revenue for 2023, a 13 per cent uptick on the year prior and described as “record results”.
The aerospace division’s operating profit grew from a £134m loss to a £17m profit after the company pivoted its strategy to a “pureplay” aerospace business and demerged the GKN Automotive, GKN Powder Metallurgy and GKN Hydrogen divisions from Melrose into Dowlais Group on 20th April 2023.
The firm updated its guidance to reflect expected 2024 revenues of between £3.6-£3.75bn, tempered by “ongoing sector-wide supply chain issues”.
A final dividend of 3.5p per share has been proposed for 2023, making a total dividend for the year of 5p per share to be paid on 8th May.
Some headcount changes also came alongside the results, with Melrose Industries announcing the departure of former chief executive Simon Peckham yesterday, with Geoffrey Martin and Christopher Miller also stepping down from their respective director roles.
“During their tenure, the business has grown from a start-up in 2003, to a well-positioned FTSE100 enterprise, having delivered total returns of capital of over £8 billion to shareholders, and an average return of 2.5x shareholders’ equity for the businesses sold under the previous business model,” the company noted.
Former chief operating officer Peter Dilnot replaces Peckham at the top of the company effective immediately, having served five years in his previous post.
Commenting on the results today, Dilnot said: “Melrose Aerospace has delivered record results in 2023, ahead of upgraded guidance driven by strong operating margin progression in both divisions.
“The Group is well positioned to deliver continued growth and margin improvement supported by positive end markets and excellent operational momentum.
“We have upgraded guidance for 2024 and are confident about unlocking significant further potential of the business going forward.”
Shares in the company were down four per cent as of 9am this morning.