Automotive and aerospace group GKN saw its underlying full-year pretax profit rise by 11 per cent on strong performances from its aerospace and OffHighway divisions and said it had won "exceptional levels" of new business for the year ahead.
The technology and engineering firm, which has its corporate offices at Redditch, said underlying pretax profit for the year ending December 31 increased to £255 million from £230 million last time on a seven per cent rise in sales to £4.12 billion from £3.84 billion previously.
The company raised its final dividend by 5.5 per cent to 13.5 pence and GKN's earnings per share jumped 17 per cent to 35.1 pence from 30.1 pence last time. Its operating profit rose ten per cent to £277 million from £251 million.
The group's chief executive Sir Kevin Smith said 2007 had been a year "when GKN moved decisively into a higher gear" and "the outlook for our major markets remains positive despite continuing uncertainty around the global economy".
GKN, which has facilities in over 30 countries, confirmed it completed its strategic restructuring programme during the year, increasing the presence of its automotive businesses in high growth economies.
"We have now transferred one-fifth of our automotive manufacturing capacity from western Europe and the US into Latin America, eastern Europe and Asia, putting us in a strong position to take full advantage of the continuing growth of these markets," said Sir Kevin.
GKN added that a range of new technology-led products were also launched with aerospace, OffHighway and automotive customers.
Sir Kevin said exceptional levels of new orders were secured in 2007.
Driveshafts won 80 per cent of all available new business, he said, adding that aerospace won new orders worth in excess of £500 million with other divisions also strengthening their order backlog.
"In aerospace we won orders for the CH53K, a large helicopter for the US army and for winglets on the Boeing 767 and 737 for the aftermarket. Composites for the Honda Jet were also included and we extended our position with the Boeing 787 and on 747-800 engine structures," he said.
During the year, GKN was selected by EADS-owned Airbus as the preferred partner for the acquisition of the wing structures plant at Filton in the UK and said it would likely conclude the transaction by mid-2008. The firm believes this will push its combined Airbus and Boeing order backlog from £2.25 billion to over £3.5 billion.
"Filton will significantly expand the size of our aerospace business bringing us closer to one of the world's two global producers of large civil aircraft, as well as giving us a better balance between civil and military business and between Europe and the US. We also gain our first major position on single-aisle aircraft," said Sir Kevin.
The company also confirmed it is doing significant work on the A350 XWB, "which goes along with the Filton acquisition - we're hoping to secure around £2 million an aircraft on that programme," Sir Kevin added.
GKN said it expected to see further automotive growth in emerging markets in eastern Europe, Latin America and Asia but predicted Western markets would soften slightly in the year ahead.
GKN said Driveline and Powder Metallurgy were well positioned to deliver their strong order backlogs, while OffHighway end markets remained robust.
"Our expectation is that raw materials will remain high and if the current rate continues we will have to deal with around £30-£35 million through 2008," said Sir Kevin.