Melrose Industries shares fell 2.1% to 134.6p in early morning trading on Thursday, after the company widened its statutory operating loss to £317 million in HY1 2022 compared to £156 million in HY1 2021.
Melrose Industries noted an adjusted operating profit of £171 million against £196 million the last year.
The firm widened its statutory pre-tax loss to £358 million from £275 million, along with an adjusted operating profit of £128 million compared to £114 million.
Melrose Industries confirmed a revenue uptick to £3.5 billion from £3.4 billion the last year.
The company reported a statutory diluted loss per share of 6.3p against 3.4p the year before and an adjusted EPS of 2.2p from 1.8p.
The firm announced a group net debt of £1.2 billion at 30 June 2022 compared to £1 billion at 31 December 2021 at like-for-like exchange rates.
Melrose Industries also noted the completed disposal of Ergotron on 6 July 2022 for proceeds of £519 million.
The company added it was on track to meet its FY 2022 expectations, with HY1 results ahead of expectations, helping to de-risk HY2.
GKN Demerger
Melrose Industries announced its intention to separate the GKN Automotive and GKN Powder Metallurgy businesses from the Melrose Group via a demerger of shares in a new holding company to Melrose shareholders.
The move is set to result in two independent and separately-listed companies, DemergerCo and Melrose Industries.
DemergerCo will reportedly seek admission to listing on the premium segment of the Official List and trading on the London Stock Exchange Main Market as an independent, London-headquartered group.
Melrose Industries said it would retain ownership of GKN Aerospace.
The company is scheduled to seek shareholder approval for the demerger in HY1 2023.
“Since acquiring GKN in 2018 we have reinvigorated each business to achieve its potential,” said Melrose Industries chairman Justin Dowley.
“The proposed Demerger now gives each an exciting opportunity to individually grow shareholder value through organic growth and acquisition in both platforms.”
“Meanwhile, we remain on track to meet our full year 2022 expectations with full inflation recovery and providing good momentum for the intended Demerger in the new year.”
Dividend and share buybacks
Melrose Industries reported £119 million of its £500 million share buyback programme had completed by HY1 2022 close.
The firm declared an interim dividend of 0.82p per share from 0.75p the last year.
