Bodycote hit by oil and gas decline

Bodycote has suffered a dip in revenue and profits as a result of falling demand in the oil and gas sectors.

In its half yearly report up to June 30, the company, which has its headquarters on Queens Avenue, Hurdsfield, reported a 4% fall in turnover to £299m (HY 2014: £312m) and pre-tax profits tumbled 3.5% to £52.6m (HY 2014: £54.5m).

Bodycote said business improvements mitigated the sharp reduction in oil and gas activities and a headline operating margin was maintained at 18%.

There was continued growth in specialist technologies and an exceptional restructuring charge of £19.9m was incurred as it exited activities in Brazil.

Net debt is at £7m and the interim dividend was up 4.3% to 4.8p.

Group chief executive Stephen Harris said:  “Our performance was resilient in the first half, with business improvements mitigating the sharp cutback in oil & gas activities.

“No upturn is anticipated in the second half in oil & gas and general industrial demand is expected to remain soft. However, the second half will benefit from the early results of restructuring and further progress in aerospace and automotive together with continued growth from the Group’s specialist technologies

“The Board is confident that management’s continued focus on business improvement will generate good returns throughout the cycle.”