Aerospace flies while flexonics falters at Senior

Aerospace was flying, while flexonics faltered at Senior in the first three months of the year, with the manufacturing and engineering group updating the market on Thursday ahead of its annual general meeting on Friday.

The FTSE 250 firm said activity in the aerospace division increased as anticipated, resulting from additional content on new aircraft including the first five deliveries of the A320neo and ramping up of the A350 by Airbus. Boeing also completed the first flight of the 737 MAX in January.

In the flexonics division, Senior said activity was still reflecting the challenging market conditions in the truck and off-highway, and industrial markets. It was continuing to focus on cost management and efficiency initiatives as a result.

The group’s net debt increased to £217.2m at the end of March, due to the normal seasonal increase in working capital, continues planned investment in capital expenditure in support of organic growth, and adverse currency impacts.

“Consistent with the position set out in the announcement of 29 February 2016, revenue in the aerospace division is expected to grow in 2016 with a stronger profit in the second half, driven by increasing revenues and operational improvements which are underway across the division,” Senior’s board said in a statement.

“The challenging market conditions in some of the flexonics end markets mean that the outlook for flexonics remains uncertain. At current exchange rates, the board's expectation for 2016 adjusted profit before tax remains unchanged.”

Looking further ahead, the board said Senior remained well-positioned for the future as new aerospace and flexonics programmes and produces entered production with Senior increasingly benefiting from strong customer relationships and global reach.

“Staying focused on customer alignment, operational excellence and investing in organisational capability and leadership talent will enable Senior to continue to grow organically over the longer-term,” the board explained.

“Furthermore, Senior's cash-generative nature and robust financial position provide a solid platform from which the group can continue to pursue growth opportunities to complement its existing portfolio.”