Engineering group Senior - which makes high technology components for the aerospace and auto industry - yesterday said its future prospects were "very encouraging" after it unveiled a 20.8 per cent rise in first half profits.

The group said pretax profits rose from £7.2 million to £8.7 million in the six months to June.

Turnover climbed 17.2 per cent, from £166.9 million to £195.6 million, while adjusted operating profit was up 10.9 per cent at £6.1 million, with margins rising to 6.1 per cent from 5.9 per cent.

Chairman James Kerr-Muir told shareholders: "The group has delivered an excellent set of results with strong revenue growth and adjusted profit before taxation 23 per cent ahead of the prior year.

"With the new heavy duty diesel engine products going into production before the end of the year, Sterling Machine making a good start following its acquisition in January 2006 and the commercial aerospace market increasing build rates at a fast pace, future prospects for the group remain very encouraging."

Senior, which has operations in 11 countries, said aerospace revenues grew strongly as commercial aircraft and engine manufacturers increased build rates at a fast pace.

It acquired Sterling Machine, a US manufacturer of transmission and rotor-head helicopter components for the military, in January for £21.4 million.

During the five month period from the date of acquisition to 30 June, Sterling Machine reported revenue of £5.2 million and trading profit of £600,000.

Overall revenues for Senior's Aerospace division increased by 27.9 per cent to £95.3 million, with adjusted operating profit up by 28.6 per cent to £8.1 million.

Turning to the division's outlook, Mr Kerr-Muir added: "The large commercial aircraft and engine manufacturers have strong order books and their markets are forecast to continue to grow.

"Boeing and Airbus have indicated that they will continue to increase their build rates over the coming years, with the availability and prices of metals, such as aluminium and titanium, potentially dictating the rate of increase.

"Following its recent acquisition, prospects for Sterling Machine are encouraging as its main customer, Sikorsky, is in the process of substantially increasing the build rate of its helicopters.

"The development of new aircraft, such as the Boeing 787 Dreamliner, Airbus 350X and Airbus 400M also offer significant opportunities for Senior."

Senior declared an unchanged interim dividend of 0.65p per share.