First Quarter Results 2012
18 April 2012
Overview
Market conditions in Q1 consistent with expectations at the time of
28 February 2012 statement
− Global light vehicle production up 4%, civil aerospace improving and further growth
in agricultural and construction/mining markets
All businesses making good progress, underlying sales up 8%
Management basis (1)
Sales
Trading Profit
Trading Margin (%)
Profit before Tax
2012
Q1
£m
2011
Q1
£m
Change
1,742
1,487
17
142
119
19
8.2%
8.0%
0.2pts
125
107
17
2
Q1 2012 – THREE MONTHS ENDED 31 MARCH 2012
(%)
Automotive markets
Global light vehicle production increased by 4% - strongest markets include Japan,
North America and India while Brazil, Europe and China fell
50
49%
40
Japan
30
% change
North America
20
10
15%
India
China
5%
Europe
0
-10
Brazil
-4%
-8%
-10%
-20
Strong recovery in Japan following disruption caused by earthquake/tsunami in
March 2011
Production in China more positive for non-domestic OEMs
European premium vehicles remain strong
3
Q1 2012 – THREE MONTHS ENDED 31 MARCH 2012
Divisional performance
GKN Driveline
Underlying sales up 8%, significantly outperforming global vehicle production of 4%
Growth achieved in every major market, except Brazil
Getrag Driveline Products business performed strongly
Sales up 26% to £847m; trading profit increased 28% to £64m; trading margin
improved to 7.6%
GKN Powder Metallurgy
Underlying sales up 10%, significantly ahead of global vehicle production of 4%
Good growth in North American automotive production and new programme launches
across the Division
Sales up 9% to £236m; trading profit increased 10% to £22m; trading margin
improved to 9.3%
4
Q1 2012 – THREE MONTHS ENDED 31 MARCH 2012
Divisional performance
GKN Aerospace
Aerospace markets performed as expected
Ramp-up in a number of civil programmes more than offsetting the decline in
military sales
Sales up 5% to £370m; trading profit increased 13% to £36m; trading margin
improved to 9.7%
GKN Land Systems
Markets have continued to show solid demand for mining and construction equipment
and European agricultural equipment performed robustly
Underlying sales up 8% and Stromag business performed well
Sales up 20% to £264m; trading profit increased 44% to £26m; trading margin
improved substantially to 9.8%
5
Q1 2012 – THREE MONTHS ENDED 31 MARCH 2012
Outlook
The outlook for GKN’s markets remains in line with our February statement.
Although the macroeconomic environment remains uncertain, we expect
2012 to be a year of good progress for the Group, based on our market
leadership positions, advanced technology and global footprint.
GKN
Delivering Sustainable Growth
6
Q1 2012 – THREE MONTHS ENDED 31 MARCH 2012
Financial Summary
Management Basis (1)
2012 Q1 £m
2011 Q1 £m
Change (%)
Driveline
847
673
26
Powder Metallurgy
236
217
9
Aerospace
370
352
5
Land Systems
264
220
20
25
25
-
1,742
1,487
17
Driveline
64
50
28
Powder Metallurgy
22
20
10
Aerospace
36
32
13
Land Systems
26
18
44
1
1
-
(7)
(2)
Total trading profit
142
119
Interest
(14)
(9)
(3)
(3)
125
107
Other Businesses
Total sales
Other Businesses
Central Costs
JV interest and tax
Profit before tax
Management Basis (1) – please see press release for definition
http://www.gkn.com/media/News/Pages/Interim-Management-Statement.aspx
7
Q1 2012 – THREE MONTHS ENDED 31 MARCH 2012
19
17