Senior sees aerospace boost as aircraft demand grows

(Sharecast News) - UK aerospace engineer and Boeing supplier Senior reported a jump in 2023 profits and said it had been asked to maintain supply levels of parts for the US plane maker's B737-Max aircraft. The company on Monday almost doubled adjusted pre-tax profit to £38.3m for the 12 months to December 31, on revenues of £963.5m, up 14%. The full-year dividend was lifted 77% to 2.30p a share.

Civil aerospace, which makes up 42% of the group's market, is starting to recover from the impact of the Covid pandemic, with passenger traffic volumes increasing sharply.

However, Boeing has been dogged by technical issues with the 737-Max variant with two fatal crashes and the recent blow out of a panel from a plane operated by Alaska Airlines in January.

Senior said Boeing had confirmed that production of the B737-Max would stay at 38 aircraft until any increase was approved by the US Federal Aviation Administration (FAA).

Boeing has previously said that they plan to increase B737 production to 50 per month over the 2025/2026 timeframe.

"During the pause in the expansion of B737-MAX production, Boeing has said that they will maintain the current master schedule, which for some suppliers may be above rate 38 per month, to avoid disruptions to the supply chain and support future production increases once authorised by the FAA," Senior said.

Looking ahead, the group maintained guidance and said it was benefiting from increasing aircraft build rates "which we expect will lead to higher sales in 2024 and beyond".

"Supply chain issues are improving as anticipated and we expect further improvement as 2024 progresses," the company said.

Reporting by Frank Prenesti for Sharecast.com