GKN Share Discussion Threads

[mj19] 28/2/2012 10:46

GKN raises dividend 20 pct after strong full-year results
10:05 am by Andre Lamberti Overall sales rose 13 per cent year-on-year to £6.1 billion and pretax profit rose 15 per cent to 417 billion, with all four divisions at or near record profits, the group saidOverall sales rose 13 per cent year-on-year to £6.1 billion and pretax profit rose 15 per cent to 417 billion, with all four divisions at or near record profits, the group said

Engineering group GKN (LON:GKN) reported solid rises in revenues and profits for the full-year to end-December 2011 and raised the total dividend by 20 per cent to 6 pence a share.

Overall sales rose 13 per cent year-on-year to £6.1 billion and pretax profit rose 15 per cent to 417 million, with all four divisions at or near record profits, the group said.

The company operates in four divisions; Driveline, Powder Metallurgy, Aerospace and Land Systems.

Although the macroeconomic environment remains uncertain, GKN expects 2012 to be another year of good progress for the group.

In automotive, external forecasts suggest that global light vehicle production should grow 5 per cent with increases in Asia and North America, but Europe decreasing.

Therefore GKN Driveline and GKN Powder Metallurgy are expected to show further improvement, however at a lower rate than in 2011.

In aerospace, civil aircraft production is expected to continue to grow, as both Airbus and Boeing increase production. This should more than offset the anticipated reduction in US military aircraft demand.

Although new programmes may be subject to delays, GKN Aerospace is expected to maintain its sales growth in 2012, the group said.

The performance of GKN Land Systems should continue to improve, benefiting particularly from the expected on-going strength in European and North American agricultural equipment markets.

"Overall, the group's broad exposure to global markets, strong customer positions and healthy order books mean that GKN should make further progress in 2012, with the added benefit of a full year contribution from the recent acquisitions," GKN added.

[mj19] 28/2/2012 10:32

oh well, 1g down on the day so far

[cyclone x] 28/2/2012 10:29

Buy on rumour, sell on news.


Glad I sold yesterday, and guess what I did top up, and lost my profit too

[mj19] 28/2/2012 10:17

Specialist engineer GKN fell 5.8p at 226.7p, despite raising its dividend in response to a surge in full-year earnings.
utomotive and aerospace engineer GKN hiked its total dividend by a fifth after seeing double-digit growth in both sales and profits in 2011.

Sales (on a management basis) rose by 13% from £5,429m to £6,112m, an underlying increase of 10%, as a more subdued performance in GKN Aerospace was offset by strong growth in its Driveline, Powder Metallurgy and Land Systems divisions.

Tough trading in Aerospace has already been widely reported, as defence firms have struggled with governments' defence spending remaining under pressure. Nevertheless, GKN says that civil aircraft production is expected to continue to grow in 2012, with both Airbus and Boeing increasing production, and this should more than offset the anticipated reduction in US military aircraft demand.

Revenues on a management basis, which aggregates the sales and trading profit of subsidiaries (excluding certain subsidiary businesses sold and closed) with the group's share of the sales and trading profit of joint ventures, are said to better reflect the performance of continuing businesses.

Pre-tax profit jumped from £363m to £417m, a 15% increase despite a £19m net cost relating to a temporary plant closure in the US. The trading margin, excluding this charge, improved to 8.0%, from 7.6% the year before, and while this was at the bottom end of the medium-term target range of 8-10%, GKN has raised its margin targets for three of the its four divisions.

"GKN achieved a strong financial performance with all four divisions at or near record profits. Each division has leading technology and market positions and out-performed their respective markets, with a strong pipeline of new business. GKN Driveline and GKN Land Systems were further strengthened with the two highly complementary acquisitions of Getrag Driveline Products and Stromag," said Chief Executive Nigel Stein.

A final dividend of 4p per share was recommended, taking the total payout to 6p per share, up 20% on last year's 5p-per-share dividend.

While the group acknowledges that the macro-economic environment remains uncertain, it expects 2012 to be another year of good progress. "Overall, the group's broad exposure to global markets, strong customer positions and healthy order books mean that GKN should make further progress in 2012, with the added benefit of a full year contribution from the recent acquisitions."

[ignoble] 28/2/2012 08:51

Panic not , just the way the market works ...bit of a "bull account" in the stock ahead of the numbers ...bit of profit taking as the mkt was expecting positive things.

Shake those "holders" out and we should firm up again.

All IMHO & no advice intended whatsoever

[mj19] 28/2/2012 08:48

buy more yesterday crying now... wtf... what more could they have done

[bluebelle] 28/2/2012 08:46

Good question. Very good set of results; increased dividend and positive forward statement. What more did the market expect? Oh yes, GUMBERR, ...............!!!!

[mrminister] 28/2/2012 08:41

in the woodshed .....wtf do the market want

[thorpematt] 28/2/2012 07:58

MEAN CONSENSUS 21.6P EPS

[electronica] 28/2/2012 07:34

melody

Concensus eps was 22.18p - so 22.6p was a good result
Consensus ptp was £419m - so the adjested £417m is pretty much in-line

[bigbigdave] 28/2/2012 07:32

This line is the key imo

'all four divisions at or near record profits'

[melody9999] 28/2/2012 07:29

Anyone know has the results look compared wth expectations? Outlook certainly looks positive.

[broadwood] 28/2/2012 07:17

Specialist engineer GKN said today group sales were up £683m (13%) to £6.1bn in the year to end-December, an underlying increase of 10%. Profit before tax was £417m (2010: £363m), an increase of 15%.

Reported profit before tax was £351m (2010: £345m).

Trading profit was £487m, up £76m, an increase of 18%.

Group trading margin of 8% was up from 7.6%, and increased targets have been set for three divisions.

Earnings per share were up 9% to 22.6p (2010: 20.7p) and return on average invested capital (excluding 2011 acquisitions) was 18.3% (2010: 17%), reflecting higher profitability.

A final dividend of 4p will be paid, giving a total for 2011 of 6p per share (2010: 5p per share), a 20% increase.

Net debt at period end was £538m (2010: £151m), reflecting £444m for new acquisitions.

Nigel Stein, CEO, said: '2011 was a year of good growth. GKN achieved a strong financial performance with all four divisions at or near record profits. Each division has leading technology and market positions and out-performed their respective markets, with a strong pipeline of new business. GKN Driveline and GKN Land Systems were further strengthened with the two highly complementary acquisitions of Getrag Driveline Products and Stromag.

'As a result of the strong performance and reflecting our confidence in the future, the Board is recommending a final dividend of 4.0 pence per share, making a total of 6.0 pence for 2011, an increase of 20%.

'Looking forward, GKN expects 2012 to be another year of good progress for the Group.'

[broadwood] 27/2/2012 15:18

Results tomorrow.

[bluebelle] 27/2/2012 14:55

GKN Driveline Wintertest Program Developing and Proving Advanced Components in Hostile Environment

ARJEPLOG, Sweden, Feb. 27, 2012 /PRNewswire/ -- Every winter, vehicle manufacturers and many Tier 1 suppliers seek to prove their products in the most hostile of environments - global engineer GKN Driveline is no exception.

(Logo:

At its proving ground close to the Arctic Circle, where temperatures drop as low as -50 degrees Celsius (-58 degrees Fahrenheit), GKN Driveline has for more than 20 years subjected its growing range of advanced systems and solutions to just such tests in order to ensure optimum capability for its customers.

"All of our customers, making cars from the top premium brands to the rudimentary, are seeking greater driveline sophistication," comments GKN Driveline's head of research and development, Jorg Trommer. "In addition, functional longevity, safety, the need to deliver more power and torque with less mass, and more recently, the focus on driveline efficiency are all universal drivers. Our annual wintertest program provides us with an invaluable opportunity to prove both existing products and new technologies in a wide variety of cold weather tests."

GKN Driveline's Winter Proving Ground offers a vast array of winter-testing facilities within its 5.5 square miles, including 18 land tracks for handling, a six-mile forest track and various lake tracks. Inclined or flat tracks half of which may be polished ice and the other heated tarmac offer the ultimate test for advanced driveline components, an area in which GKN Driveline is a world leader. The proving ground also has cold chambers for more extreme testing and all of this is supported by workshops and office spaces for customers to analyse data and record their test findings.

GKN Driveline offers a wide range of systems and solutions all designed to provide vehicle manufacturers with fuel-efficient, reliable and safe advanced technology to ensure the greatest performance and handling dynamic possible. Among those being tested this year:

ECO2 Twinster®: a rear-mounted hydraulically actuated disconnect for AWD vehicles that provides electronic limited slip differential (eLSD) and torque vectoring functionality and negates the need for a differential. Working with GKN Driveline's front-mounted power transfer unit (PTU), with a synchronised disconnect, the system's ability to reduce drag during non 4x4 driving greatly reduces fuel consumption in ECO2 mode.
Electronic Torque Vectoring (ETV): an active torque-management device designed to overcome the tendency of vehicles to under-steer under power in corners. First seen on BMW's X6, the ETV applies an additional yaw rate to the vehicle to improve agility and handling and to stabilize the vehicle. This yaw rate is realised by distributing drive torque individually to both wheels of one axle, a feature that can be crucial when driving on ice and snow.
Electro-Magnetic Control Device (EMCD®): an actively controlled coupling in on-demand and full-time all-wheel drive mode controlling the driveline power flow for 2 or 4- wheel-drive vehicles to provide optimum performance when needed. At extremes, up to 50 percent of the power can be sent from the primary driven axle to the secondary driven if necessary. Most often the EMCD® will be working to provide optimum apportionment of power between rear and front wheels in a wide range of driving manoeuvres. For instance, when accelerating from a stop, enhancing control in corners and adapting to poor, varied or ice-and-snow road conditions.
Electronic Torque Manager (ETM®): a rear-axle differential with an integrated active differential that provides unsurpassed vehicle traction and stability through high-speed optimal torque allocation to the powered wheels. Its integrated electronically controlled direct actuation makes it a highly suited module for improving dynamic performance in performance cars in all conditions, including of ice and snow.
Electric All-Wheel-Drive – eAxle: an eAxle with motor and sideshafts provides a simple, flexible and cost-effective solution that addresses two key car maker requirements: firstly, reducing emissions and improving fuel economy; and secondly achieving all-wheel-drive capability. By creating a hybrid electric powertrain, the system can deliver a 30 percent improvement in fuel economy, while at the same time providing on-demand all-wheel-drive – with no need for a mechanical link between the combustion engine and the rear axle.
EV Transmissions – eTransmissions: the eTransmissions are designed for applications across a wide range of vehicles from city cars to high-performance electric vehicles. eTransmissions can transmit up to 300kW of power and are available with ratios up to 14. The variable interface allows GKN Driveline's eTransmissions to be matched with eMotors from various suppliers to enable flexible applications. Special features like a unique "drop-in" electric-park brake system or limited-slip differentials are available to meet any specific customer requirement. GKN Driveline's eTransmissions have been developed for compact packaging and high-torque capacity with superior NVH performance and high efficiency.
Rob Rickell, global engineering director, GKN Driveline notes: "In Sweden, we are able to support our customers in testing new technologies to the extreme. This allows us to refine those ideas in a totally convincing and functional manner.

"Sweden is one of our three world-class wintertest locations – along with Northern Michigan in the USA and Hokkaido in Japan."

GKN Driveline's Product Segments include:

CVJ Systems

GKN Driveline's constant velocity joint systems provide space, weight and fuel savings with greater all round efficiency.
GKN Driveline supplies the most extensive range of CVJ systems – used in the smallest ultra-low cost car through to the most sophisticated premium vehicle.
AWD Systems

GKN Driveline has full all-wheel drive systems capability.
GKN Driveline's all-wheel drive couplings improve vehicle handling, stability and traction by intelligently distributing power, and disconnecting technology can supplement low drag and inertia for ultimate efficiency.
Trans Axle Solutions

GKN Driveline produces highly durable open differentials and has the most extensive range of limited slip differentials (LSD), from the smallest Super LSD to the largest electronically controlled axle locker.
For the ultimate capability, GKN Driveline's torque vectoring solutions provide the answer.
eDrive Systems

GKN Driveline's pioneering electric drive technology is used in 250,000 vehicles today.
GKN Driveline's eDrives are designed for the new generation of fuel efficient, low emission electric and hybrid vehicles.
Editor's notes:

About GKN Driveline

GKN Driveline is the world's leading supplier of automotive driveline components and systems. As a global company serving the world's leading vehicle manufacturers, GKN Driveline develops, builds and supplies an extensive range of automotive driveline components – for use in the smallest ultra low-cost car to the most sophisticated premium vehicle demanding the most complex driving dynamics.

[thorpematt] 25/2/2012 10:27

Need to change name of thread at this rate to "GKN 2012 onwards - a great recovery play".

Results due on Tuesday




Quite easy to see why targets are set at 250p. Seem an obvious compromise between previous chart resistance and "round number" barriers.

If we look longer term though I'd say a price of nearer £4 would give more sensible PE ratios given the seemingly misunderstood likely growth prospects.

Definately a stock with high correlation to the UK index mind you. Equally definately a stock which represents good value. Therefore a good one to buy when there the idexes dip.

I give the Greeks 6 months. (The can has been kicked but I can still see it in the distance).

[ignoble] 24/2/2012 17:49

Always liked UBS ...he-he

[valedo] 24/2/2012 16:12

UBS has raised its target price for automotive and aerospace engineer GKN to reflect an improvement in the outlook and the upside risk to its growth forecasts.

The broker says that 2011 was a "turbulent year" due to the events in Japan, Gallatin and Thailand. "2012 passing without major incident would be a £50m profit boost, which in combination with pro-forma acquisition effects of £30m does not make the remaining £20m bridge in our numbers too heroic providing GKN sees some volume growth." UBS says that an improving economic outlook is bringing upside risk too.

The target price is lifted from 225p to 250p. UBS maintains its buy rating on the stock, saying that the transition to a new Chief Executive Officer (Nigel Stein) and the potential for a review of margin targets and/or additional returns also provides a leg to the investment case.

[valedo] 24/2/2012 12:56

looking promising ahead of results, - next week I think, 28th.

[bigbigdave] 24/2/2012 10:24

Got me at it now, Takover? :o)

[bigbigdave] 17/2/2012 19:45

Rest over, ready for the onslaught on last July's high.