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GKN expects to offset currency effects with higher gains in 2014

After reporting a 17-percent surge in underlying pretax profit of EUR578 million ($961.25 million) in 2013, British supplier GKN expects higher gains this year that would offset the effect of a weak dollar versus the pound. GKN expects its auto business to grow at a faster rate than an anticipated 3 percent gain in the market this year.

The company added that its aerospace unit would post higher sales in 2014. GKN was able to exceed a company-supplied consensus forecast of GBP565 million, thanks to a strong performance in its automotive business, which accounted for about 45 percent of sales.

"The dollar is going to be a headwind. It's been a tough start," GKN chief executive Nigel Stein said, noting that a 1-percent move in the dollar would have around a GBP4 million ($6.65 million) impact on profit. He, however, expressed confidence that GKN could offset that.

Read the entire article GKN expects to offset currency effects with higher gains in 2014

GKN posts 4% drop in 1st quarter pretax profit to £119 million

GKN logged a 4-percent cut in pretax profit in the first quarter of 2013 to £119 million ($181.3 million), due to a restructuring charge as well as the declining vehicle production in Europe, Japan and India. According to the British engineering group, its profits were badly affected in part by a £23-million restructuring charge related to job cuts in Europe and Japan.

The UK supplier’s trading margin dropped 0.7 percentage points to 7.4 percent. Profits at its Driveline division, which manufactures vehicle components like driveshafts, chassis and axles, succumbed to a 20-percent drop after suffering from weak demand, especially in continental Europe. Driveline, whose customers include Volkswagen, General Motors Co. and Ford Motor Co., accounts for around 55 percent of GKN’s total profits.

Margins at Driveline dropped to 6 percent in the first three quarters of 2013 from 7.6 percent in the same period in 2012. This could be attributable to the slumping demand for new vehicles in Europe as consumers try not to make expensive purchase while the current economic crisis in the region continues.

Read the entire article GKN posts 4% drop in 1st quarter pretax profit to £119 million

Automobile business drove up GKN’s 2011 profit by 15%

Plane and vehicle parts manufacturer GKN disclosed that a strong performance in its auto operations contributed to a 15% boost in its 2011 profit, thanks to the continuous strong demand in China as well as the increase in sales of premium vehicles. The company posted pretax profit of 417 million pounds or $660.57 million on revenue 13 percent higher at 6.11 billion pounds.

 According to GKN CEO Nigel Stein, the demand for the luxury vehicle remained strong and they feel that it will be the same this year. He also acknowledged that China is the "biggest driver" of that demand, but North America has "come back strongly too." He further stated that worldwide vehicle production "should" increase around 5% in 2012 and they anticipated delivering more growth "on the back of that."

The automobile business of GKN manufactures chassis, driveshafts, lighter auto components and axles, among other related products. The revenue of this unit comprises nearly two-thirds of group sales. It increased by 10% to 2.68 billion pounds last year.  Audi, Volkswagen and BMW are among the largest customers of GKN. These automakers revealed that 2011 sales increased due to the demand for premium vehicles in China and they expect this trend to continue.

Read the entire article Automobile business drove up GKN’s 2011 profit by 15%

GKN expects its business to continue to be hit by the earthquake in Japan

British industrial group GKN anticipates that its automobile business will continue to feel the effects of the March 11 Japan earthquake in the short term, the company’s chief executive officer, Kevin Smith, stated on Monday. However, such adverse effect on the auto business would be partially offset by the growth of the company’s other divisions.

The earthquake disrupted the company’s complex supply chain in Japan. Due to the massive damage that the earthquake caused, the country’s biggest automobile companies such as Toyota Motor Corp., and Nissan Motor Co., suspended production at their facilities.

The disruption also affected the manufacturers abroad, especially those in Europe and North America, as the component supply problems from Japan halted or reduced their production in their factories.

Read the entire article GKN expects its business to continue to be hit by the earthquake in Japan

Because of the strong auto demand in North America and Asia, partsmaker GKN was able to post a third quarter pre-tax profit that more than doubled. Its revenues were also 21% higher, leading the company to predict a positive end to 2010.

In a statement Last Tuesday, the GKN said that the outlook for GKN's markets in the fourth quarter “remains positive” with group sales expected to attain a similar level to the third quarter.

Sales had increased to nearly 1.34 billion pounds from 1.10 billion. Meanwhile, pretax profit in the third quarter increased to 88 million pounds ($140 million) from 37 million a year earlier.

Read the entire article Partsmaker GKN says third quarter pre-tax profit more than doubled