Meggitt says U.S. unit cleared of 787 fire blame
LONDON (Reuters) - Aircraft parts supplier Meggitt (MGGT.L) said a product made by its U.S. unit had been cleared by regulators of causing a battery fire on Boeing's (BA.N) troubled 787 Dreamliner jet.
The British firm said on Tuesday the charger for batteries used on the 787, made by one of its U.S. subsidiaries, Securaplane Technologies, had passed tests conducted by the U.S. National Transportation Safety Board (NTSB).
One battery caught fire onboard a Japan Airlines Co (9201.T) 787 in Boston while another forced an All Nippon Airways Co (9202.T) plane to make an emergency landing in western Japan in January, prompting regulators in the U.S., Japan and elsewhere to ground all 50 Dreamliners in operation.
"Our products have been through a lot of tests, including the two damaged units from the fires, and they both re-passed all the required tests. The unit is doing what it is supposed to do," Meggitt's finance director Stephen Young, who will take over as the group's chief executive this summer, told Reuters.
"Boeing are still building up the 787 and at the moment they are still taking products for it but I guess when the car park is full that may not continue to be the case."
No one at Boeing's London office was immediately available to comment.
Earlier on Tuesday, Meggitt, which also supplies flight displays and wheels to planemakers, said 2012 pretax profit rose 12 percent to 362.8 million pounds ($547 million), a slowdown on the 26 percent profit growth it delivered in 2011, but ahead of an average forecast of 344.60 million pounds, according to a Thomson Reuters I/B/E/S poll of 13 analysts.
Meggitt's revenues rose 10 percent to 1.60 billion pounds, boosted by 7 percent growth at its civil aerospace unit, which was helped by strong demand for Airbus A320neo and Boeing 737MAX planes, offsetting slower than expected aftermarket sales, which include parts and maintenance.
Meggitt sees mid-single digit organic growth in 2013, underpinned by the ramp-up of several civil aerospace programs.
Global airlines will buy $3.5 trillion of aircraft over the next 20 years to meet demand for travel to and from emerging markets and renew ageing fleets with more fuel-efficient planes, according to the world's big two planemakers, helping suppliers such as Meggitt.
Military sales rose 7 percent but Meggitt said it expected 2013 sales from the unit to be flat at best in 2013, primarily due to further cuts in U.S. defense spending.
"While we anticipate the strength in military to wane over the next few years as a result of sequestration, we expect the civil aftermarket to strengthen again from 2013," said Edison analyst Roger Johnston, referring to U.S. budget caps.
Shares in Meggitt, which have risen a fifth so far this year, were up 4.5 percent at 479.8 pence by 1010 GMT, valuing the group at around 3.75 billion pounds.
The company said revenues at its smaller energy unit rose 45 percent, boosted by a large order from Petrobras to equip its new fleet of vessels.
Meggitt, which increased its final dividend by 12 percent to 11.80 pence, said order intake during the year was 1.64 billion pounds, giving a group book-to-bill rate of greater than one, underpinning its confidence in future revenue growth.
($1 = 0.6635 British pounds)
(Editing by Neil Maidment and Helen Massy-Beresford)
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