Hampson Industries

Hampson Industries expects customer delays on aerospace tooling orders will reduce revenues this year, despite a 40% increase in quotations.

A world leader in aerospace tooling, the fully-listed company, which lost £15.4m in year to March despite a 62% turnover advance to £257m, says that outstanding quotations, over and above current order books, have now reached more than £250m. However, Hampson warns it is still seeing ‘time delays’ as customer processes and ‘cash flow management’ slow the release of large new orders, in particular on the Boeing 787 ‘Dreamliner’, the A350 Airbus and Lockheed Martin F-35 strike fighter programmes

The company, steered by chief executive Kim Ward, says the timing of the conversion of pipeline demand into firm orders for high value tools needed in programmes like these will determine the outcome for the current year. Meanwhile, Hampson has streamlined its operations and reduced debt by selling its HAML aerospace machining division for £23.7 million.

Despite ‘difficult’ trading conditions so far this year, directors argue Hampson is still ‘well positioned’ to convert opportunities now available into ‘attractive’ returns for shareholders. Analysts expect a solid return to profit in the current year.

Highlighted by Growth Company Investor at 100.5p in April, the shares, which not so long ago reached 183p, have fallen to 74p. Investors should consider cutting their losses on some of their holdings but hanging on to some for later recovery prospects.