GKN spin-off Dowlais points to flat revenues in 2024

The company, which was formed from the spin-off of GKN's automotive and powder metallurgy divisions last year, said industry forecasts are pointing to a "slight decline" in global light vehicle production in 2024.

"Based on these external forecasts and our current order book, we anticipate group revenues will be similar to the prior year, at constant currency, with a modest reduction in the first half offset by an improvement in the second half due to the expected timing of several new programme launches," said chief executive Liam Butterworth.

For 2023, Dowlais reported a 4.6% increase in adjusted revenues to £5.49bn, driven by volume growth in automotive and inflation recoveries across the group.

Adjusted operating profits were up 6.6% at £355m helped by a 20 basis-point improvement in operating margins to 6.5%.

However, statutory pre-tax losses widened significantly to £522m, from a loss of £63m previously, after a £449m non-cash goodwill impairment charge resulting from a review of medium-term trading prospects of Powder Metallurgy.

The company ended the year with £93m of adjusted free cash flow, which is said was ahead of its expectations, helping to reduce net debt to £847m from £880m the year before.

The final dividend was proposed at 2.8p per share, resulting in a total payout of 4.2p for the year. The board also announced its intention to start a share buyback programme of up to £50m over a 12-month period from April.

The stock, which has lost over a quarter of its value since listing in London in April 2023, was down a further 3.31% at 86.96p by 0956 GMT.