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Melrose Industries PLC on Wednesday kept its financial guidance for 2026 intact, saying it ‘made a good start to the year’ but is monitoring the impact of the Middle East conflict on the aerospace industry. Melrose is a Birmingham, England-based aerospace and defence business largely composed of the former GKN. Its shares were down 3.1% to 473.40 pence early Wednesday in London. The wider FTSE 100 index was down just 0.7%. Melrose told its annual general meeting on Wednesday that revenue grew by 11% in the first quarter, with revenue up 20% at the Engines division and up 4% at Airframes. This growth, together with improved profit margins, means adjusted operating profit for both divisions and the group as a whole was ‘well ahead’ of a year before, Melrose said. As well, net debt and free cash flow were in line with expectations, it said. Commenting on the impact of the US-Israeli war on Iran, Melrose said it has no operations in the Middle East and ‘minimal direct supply chain exposure’. However, it is seeing some increases in freight costs, and it will be watching for any potential reduction in civil flying hours due to reduced jet fuel availability. Looking ahead to all of 2026, Melrose said that, assuming no material impact from the war, its guidance is unchanged. This is for adjusted operating profit of £700 million to £750 million on £3.75 billion to £3.95 billion in revenue. Free cash flow after interest and tax is expected to be £150 million to £200 million. Profit and cash will be second-half weighted, in line with historic and industry seasonality, Melrose said. It will publish its full results for the first half of 2026 on July 31. Copyright 2026 Alliance News Ltd. All Rights Reserved.
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