Pre-tax profits at GKN rose by just per cent at engineering giant GKN in the third quarter after the final charge of £11 million relating to its plant closure in the US.

Redditch-based GKN, which is involved in the automotive, aerospace and land systems sectors, revealed that pre-tax profit was £89 million in the three months to September 30, compared to £88 million the year before.

A final charge of £34 million has been taken into account in the year-to-date for the temporary closure of the Hoeganaes Gallatin plant, of which £23 million was accounted for in the first half results.

GKN assured that the plant returned to normal operations last month, but said that investors will have to wait until January 2012 to see “pre-incident levels” of output and profitability return as customer demand is fully restored.

However, due to the Gallatin charge, the trading margin fell from 7.5 per cent to 6.9 per cent in the third quarter.

Nevertheless, group sales rose by 11 per cent from £1.336 billion, to £1.483 billion, as GKN maintained the same rate of growth seen in the first six months of the year.

Net debt surged from £174 million at the end of the second quarter to £696 million by 30 September, mainly due to the £444 million acquisition costs of Stromag Holding and Getrag Driveline products. GKN expect to scale this back to £600 million by the year-end.

“Macroeconomic uncertainty has increased in recent months although no significant deterioration has been experienced in GKN’s order books,” the group assured.