Price rises, energy surcharge boost Bodycote

Heat treatment specialist Bodycote held full-year guidance and said revenues in the four months to October 30 rose by a third due to price increases and energy cost surcharges.

Total group revenue for the period grew by 29% on last year to £258m, or up 22% at constant currency rates. Bodycote introduced energy surcharges at the end of last year with the intention of covering the highly volatile costs of electricity and gas.

Automotive revenues were up 18%, entirely due to the impact of price increases and energy surcharges. Volumes were flat versus last year, as well as versus the first half of this year, despite supply chain issues easing in a number of areas, Bodycote said.

General Industrial revenues grew 25%, with volumes continuing to hold up well, supported by stronger performance in market sectors where a higher proportion of the work is for capital investment. The energy end market now comprises 17% of general industrial and grew 30%.

Aerospace & Defence revenues grew 19% as civil air travel continues to strengthen and original equipment maker production is ramping up; defence volumes were flat.

Emerging market revenues were up 47%, reflecting the highest level of energy surcharges in the group, as well as double digit volume recovery in China and Mexico. Slovakia and Turkey volumes continued to grow at double digits.

“Civil aerospace volumes continue to grow strongly, with General Industrial volumes growing more modestly and automotive volumes flat. Our approach to using surcharges to cover the highly volatile gas and electricity prices has proven to be successful,” the company said.

“The board expects the group to deliver a full year result for 2022 in-line with market expectations.”

Reporting by Frank Prenesti for Sharecast.com