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(Alliance News) - Bodycote PLC on Friday reported a profit rise on the back of successfully recovering increases in input costs through pricing, as it posted a higher dividend and a positive outlook.
The Cheshire, England-based supplier of heat treatments and specialist thermal processing services said revenue rose 7.9% to GBP802.5 million in 2023 from GBP743.6 million in 2022.
Pretax profit shot up 17% to GBP111.7 million from GBP95.3 million.
Bodycote lifted its final dividend by 7.4% to 16.0 pence per share from 14.9p, bringing the full-year total to 22.7p, a rise of 6.6% from 21.3p.
"Inflation has remained at a high level leading to further increases in certain of the group's input costs, which have been successfully recovered through pricing. The Ukraine war continued and geopolitical tensions intensified in the Middle East during the second half of the year. Bodycote has no direct exposure to any of the countries involved and has no facilities, customers, or suppliers in these territories," the company said.
Noting interest rates, it said: "In the last quarter of 2023, monetary policy interventions appear to have eased inflation rates with many central banks indicating that further rate hikes may not be required. Bodycote has continued to manage inflationary cost pressures well through annual price increases to recover rising labour and other costs and the energy surcharge programme, implemented in 2022, which has enabled recovery energy cost inflation in the year."
It added that it has kicked off a GBP60 million share buyback programme it unveiled in January.
Bodycote added: "Despite macroeconomic uncertainty we expect to deliver further progress in 2024. We anticipate a reduction in the level of energy surcharges, reflecting further normalisation of energy prices. 2024 should see us take another step towards our medium term margin target of more than 20%."
Bodycote shares rose 4.6% to 660.60 pence each on Friday morning in London.
By Tom Budszus, Alliance News slot editor
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