All very civil at Meggitt

Having just hit a new all-time high and with equity markets weaker generally, Meggitt shares fell 5 per cent post these results, despite meeting City estimates. Civil aerospace is booming, work is flooding in at the energy division and even military is improved. "All fantastic," says management, and with good reason.

On an underlying basis, group pre-tax profit grew 26 per cent to £323m, and by 14 per cent excluding the Pacific Scientific acquisition. Much of that came from civil aerospace as Airbus and Boeing fight to meet demand for new fuel-efficient passenger jets. Organic revenue there grew by 16 per cent - sales of parts to the manufacturers jumped over a quarter and aftermarket business was up 12 per cent. With deliveries tipped to take off in 2012, Meggitt expects equipment sales growth to average 7 per cent to 8 per cent over the next five years and a bit more from aftermarket.

Defence cuts have been a worry though, given the military accounts for 40 per cent of revenue. Still, sales here rose 5 per cent and management says upgrade work should offset any dip in spend on new fighter planes. Growth this year, however, will be nearer 2 per cent.

Broker Bank of America Merrill Lynch expects 2012 adjusted EPS of 35.6p (31.5p in 2011).

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