Tomkins “outlook uncertain”

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Manufacturing News, Source : TheManufacturer.com
Published : 03 May 2007 8:31
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Tomkins, the maker of car components and air conditioning systems for use in commercial and residential construction, has posted a 23 per cent fall in underlying first-quarter profit.

The company added that the overall outlook for its main end-markets was uncertain, particularly in North America.

"Demand from North American automotive original equipment manufacturers remains unpredictable and lower than a year ago,” the company said in a statement. It also said it did not expect a recovery in the US residential housing market until some time in 2008.

The company’s 2007 performance will also be hit by the weak dollar, although the company expects cost savings and the positive trends in Europe and Asia to mitigate in part the year-on-year impact.

Tomkins said adjusted profit from continuing operations fell to £58.3 million in the first quarter on sales down 11 percent to 739 million pounds.

Tomkins CEO James Nicol said: “We continue to focus on achieving the best performance in challenging end-market conditions, while taking out further costs where possible and maximising cash flow. As previously indicated, the reported results reflect the translation impact of the US dollar which was around 12 per cent weaker in the first quarter of 2007, the continued weakness in the US residential housing market and the lower demand from automotive original equipment customers in North America.”

He added that the company believes it is “well positioned for a recovery in end-market conditions whenever it occurs.” He said he is encouraged by the performance in the quarter of Tomkins’ remote tyre pressure monitoring business, Power Transmission, especially in Europe and Asia, and Fluid Power.