GKN Aerospace owner Melrose clears way for new leadership as chief departs
British aerospace supplier Melrose’s CEO and co-founder Simon Peckham will step down in March after more than 20 years and be replaced by chief operating officer Peter Dilnot, it said today, paving the way for new leadership.
The owner of GKN Aerospace, publishing its first set of results after completing the spin-off of Dowlais Group in April, also announced a £500m share buyback and lifted its full-year profit expectations on higher than expected margins at its engines division.
Shares in the company jumped 8 per cent in early trading to their highest since February 2020.
Melrose, known as a turnaround specialist with a strategy under Peckham, 61, of buying and selling manufacturing businesses, is now a pure-play aerospace group.
It has no plans to buy new businesses in other sectors or a material one in the aerospace industry in the near term, it said.
“The company believes that this is the right time to begin evolving the executive management team to progress the changed strategy,” it said.
Finance director Geoffrey Martin, who has been with the group for more than 18 years, will be replaced by Matthew Gregory, currently finance chief of GKN Aerospace.
“Melrose is flying into markedly improved conditions and, although change at the top can be unsettling, the ready replacements for the CEO and group finance chief will limit turbulence,” said Hargreaves Lansdown analyst Susannah Streeter.
Dilnot, a former executive at Danaher Corp, became COO in 2019. He was a helicopter pilot in the British Armed Forces, with a degree in mechanical engineering.
Under Peckham, Melrose acquired GKN, one of the UK’s oldest engineers, in 2018 through an £8bn hostile bid. Last year it announced plans to break it up by spinning off GKN’s automotive, hydrogen and powder metallurgy businesses.
Melrose’s adjusted pretax profit from continuing operations was £134m for the six months to June 30, compared with £9m a year earlier.
The company, which makes airframe and engine structures and counts Airbus and Boeing as its top customers, now expects full-year adjusted operating profit to be between £375m and £385m, up about 8 per cent from a forecast in May.
Reuters