Net debt rises to £696m at GKN
Acquisition costs have increased engineering giant GKN's net debt to £696m - a £522m hike on its 2010 figure, the company revealed this morning.
The Redditch-based company said the debt increase was largely due to the £444m acquisition costs of Stromag Holding GmbH and Getrag Driveline Products, which were both completed in September.
Net debt is expected to be about £600m at the year end, said GKN, adding that about £400m of new committed revolving credit facilities were recently secured which mature in 2016.
GKN revealed the statistics to the Stock Exchange this morning. In the report, the company said sales for the three months to 30 September had increased from £1.3m in 2010 to £1.5m. Pre-tax profit was also boosted by £1m to £89m.
Recently-acquired Stromag added £10m of sales over the period, but its profit was mostly offset by acquisition costs.
"Macroeconomic uncertainty has increased in recent months although no significant deterioration has been experienced in GKN's order books," said the company.
"In automotive, driveline and sinter metals are expected to continue to deliver similar levels of underlying improvement over 2010 to that achieved in the third quarter, with trading in Hoeganaes continuing to improve.
"Overall we continue to expect 2011 to be a year of strong progress, with the group well positioned for growth in 2012 and beyond."
