Dowlais reiterates FY guidance despite strike action

Automotive supplier Dowlais reiterated its full-year forecasts on Thursday despite taking a hit from United Auto Workers strike action in North America.

Dowlais said strikes had not impacted its ability to deliver full-year expectations, with adjusted revenues seen within the range of £30.0m-45.0m and adjusted operating profits expected to be £10.0m-15.0m.

For the four months ended 31 October, adjusted revenues came to £1.8bn, up 4.7% year-on-year and above global light vehicle production of 3.6%.

Group adjusted operating margins were up 100 basis points, excluding central costs, at 6.8% as a result of "successfully flowing volume to profit", fully offsetting inflation and absorbing the impact of the UAW strikes.

Dowlais highlighted that its GKN Automotive arm had already delivered "a record year of new business bookings" at £5.4bn in forecast lifetime revenues, of which £2.4bn was awarded in the four-month period.

Chief executive Liam Butterworth said: "Following a strong first half, we have continued to execute well on our strategic priorities and leverage the strength of our operating businesses. We have delivered strong growth and continued to expand margins as well as fully absorbing the impact of the UAW strike.

"Thanks to the outstanding quality of our market-leading businesses we remain confident of delivering sector-leading financial performance, regardless of the speed of electrification transition."

As of 0945 GMT, Dowlais shares were down 0.19% at 105.80p.

Reporting by Iain Gilbert at Sharecast.com