Morgan Advanced Materials Revenues Increase by 4.6% in 2015 First Half
Morgan Advanced Materials recently reported its financial results for the first half of 2015. Group revenue of £469.2 million (approximately $731.1 million) was up 4.6% on a reported basis, compared to £448.4 million (~ $698.7 million) in the first half of 2014. On a constant currency basis, revenue was up 3.1% compared to the first half of 2014, with all operating regions achieving revenue growth. Significant investment continued to be made in the Group’s future, with R&D spending increasing to 2.7% of sales and capital expenditure focused on key profitable growth markets.
In North America, reported revenue was up 11.6% compared to the first half of 2014 at £191.6 million (~ $298.5 million). At constant currency, the increase was 2.6% compared to the first half of 2014. The Thermal Ceramics and Electrical Carbon businesses continued to grow, offset by flat trading in Technical Ceramics and a small decline in the Seals and Bearings business. The performance of the ceramic cores Certech business continues to improve from the operating issues experienced in 2014. EBITA margins improved to 15.6% from 15.3% during the same period last year.
In Europe, reported revenue was marginally down against the first half of 2014 at £157.2 million (~ $244.9 million), from £159.4 million (~ $248.4 million) in the 2014 first half. On an organic and constant currency basis, revenue was up 4.7% compared to the first half of 2014, with particularly good growth in the Thermal Ceramics business, offset by some softness in Technical Ceramics. EBITA margins improved to 12.3% from 11.2% last year, with Thermal Ceramics again being the main contributor to this improvement.
In the Asia/Rest of World segment, reported revenue increased 2.6% to £120.4 million (~ $187.6 million) from £117.3 million (~ $182.8 million) last year. On an organic and constant currency basis, the revenue increase was 0.6%. This growth was achieved despite the slowdown in the Chinese industrial market that resulted in a 9.3% reduction in revenue at constant currency compared to the first half of 2014. All other major regions of the Asian business grew in the first six months of the year compared to the first half of 2014, particularly South Korea and Southeast Asia. EBITA margins were 12.0%, compared to 12.7% in the first half of 2014, with China and South America the main areas of softness in performance.
“The Group has performed well through the period with improvement across all our business performance measures,” said Kevin Dangerfield, interim CEO. “Our focus in the last six months has been on driving positive mix shift, delivering cost and operational efficiencies, and making continued investments in technology and differentiation. All three operating regions continued to achieve revenue growth despite the softness in some geographies and end markets, and the profit margin changes in the regions mirrored this mixed trading landscape. The Group's solid financial and operational platform and the investment in the business give the Board confidence in the prospects for the Group as we enter the second half of 2015.”
Additional details are available at www.morganadvancedmaterials.com.