Commercial aero and auto growth boosts GKN profits
LONDON, Oct 22 (Reuters) - Car and plane parts maker GKN posted a 34 percent rise in third quarter profit as strong growth at its automotive and commercial aerospace units made up for sluggish demand in military and industrial markets.
The British firm on Tuesday reported a pretax profit of 131 million pounds ($211.68 million) in the three months to the end of September on sales 16 percent higher at 1.87 billion pounds.
GKN, a major supplier to planemakers Airbus and Boeing and carmakers such as Volkswagen, said its trading margin rose to 8.2 percent during the period, up from 7 percent in the same quarter a year ago.
"The third quarter showed good progress, supported by automotive demand in China and North America and sustained high output levels in commercial aerospace," said GKN's Chief Executive Nigel Stein, adding that last year's purchase of Volvo's aero engine unit also helped boost profits.
The company expects auto and commercial aerospace markets to remain robust for the foreseeable future but sees softness continuing in industrial and military markets.
Global light vehicle production increased 4 percent in the third quarter of the year, with especially strong growth in China and North America, and Europe and Japan improving slightly.
Global airlines will buy more than $3.5 trillion of aircraft over the next 20 years to meet demand for travel to and from emerging markets and renew ageing fleets in the West, according to the world's big two planemakers, helping suppliers such as GKN, which makes parts for the Boeing Dreamliner and the upcoming Airbus A350 XWB.
Shares in GKN, which have risen 9 percent in the last three months, closed at 362.5 pence on Monday, valuing the group at around 6 billion pounds.
