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Former British turnaround specialist Melrose Industries has ruled out any imminent deal, saying it will focus on building a thriving aerospace business.
The company also announced the departure of its founders, a group of executives who made a string of acquisitions in engineering and manufacturing over the past two decades and built a loyal following in London’s financial district.
Chief operating officer Peter Dilnot, who will become chief executive next March, said acquisitions “inside or outside” were “not a priority”.
“We have a great opportunity to build this business into a truly world-class, competitive, UK-listed aerospace business,” he said.
Shares in Melrose rose 8% on Thursday after it raised its annual profit forecast and brought forward a £500m share buyback program after better-than-expected first-half results amid a broad recovery in the airline industry.
Dilnot will succeed current CEO and co-founder Simon Peckham. The departure of Peckham, along with co-founder and executive vice-chairman Christopher Miller, marks the end of an era for the FTSE 100 group, which listed on London’s junior Aim market in 2003 to “buy, improve ,sales strategy.
Melrose is now focusing on GKN’s aerospace business as part of its £8bn takeover of the British engineering group in 2018, following a series of smaller sales and the spin-off of its automotive business.
The company is a leading supplier of airframe structures such as wing and fuselage parts for Airbus and Boeing, and makes components for engine maker Pratt & Whitney, among others.
Adjusted operating profit is expected to be between 375 million pounds and 385 million pounds this year, up 8 percent from its previous forecast, the group said. First-half revenue was £1.63 billion, up from £1.36 billion a year earlier. Aerospace operating profit was £175m, up from £67m.
Dearnot pointed specifically to the company’s engines business, where operating margins improved 8.6 percentage points to 24.5%, driven by a recovery in air travel and improved operations.
The company makes parts for Pratt & Whitney’s geared turbofan engines that power Airbus planes, some of which have been recalled for early re-inspection.
Melrose components have not been directly impacted and the company has limited revenue from the Pratt & Whitney geared turbofan engine program, Dearnott said.
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