Meggitt scraps divi as Covid airline shutdown hits aerospace unit

The aircraft parts maker posted pre-tax losses of £368m, compared with a £73m profit a year earlier due to £373.2m in impairment losses and other asset write downs related to its civil aerospace business.

Revenue fell to £916.8m from £1.07bn, but still above consensus forecasts of £906.5m.

Sales at Meggitt’s aerospace division, which serves big plane makers such as Boeing and Airbus, fell by 27% as the airline industry was battered by travel restrictions and subsequent collapse in passenger demand.

“The recovery in civil aerospace remains sensitive to spikes in Covid-19 cases, creating near term uncertainty about the pace and shape of a recovery,” the company said, adding that full year guidance remained suspended.

“For cash, as a result of a proportion of inventory reduction moving into 2021, we now expect to be broadly free cash flow neutral for the full year.”