Carclo (LSE:CAR), a global precision engineering group serving Life Sciences, Aerospace and Safety & Security markets, said trading since 1 April has delivered strong margin performance, with underlying operating profit and return on sales in line with management's expectations.
Year-to-date revenue was slightly behind the prior year, reflecting the phasing of design and engineering tooling programmes and a slow first quarter in the CTP US business, though volumes have started recovering as the group moves into the second quarter.
"Margins, operating profit and return on sales are all ahead of last year on slightly lower revenue, with Speciality growing strongly on Aerospace demand", said chief executive Frank Doorenbosch.
The Speciality division led the volume recovery, with revenue and margin both ahead of the prior year on robust Aerospace demand, while EMEA manufacturing operations posted top-line growth and solid margins driven by the UK.
Net debt was higher at the end of July than at the FY26 year-end, due to lease extensions on US properties and working capital timing, but the group expects the working capital outflow to reverse by the end of the second quarter, leaving net debt excluding leases in line with FY26 at the half-year point.
The Board's expectations for the full year remain unchanged and in line with previously communicated targets under the Precision 2030 growth plan.
Carclo expects to announce interim results for the six months ending 30 September in November.
News Intelligence what this means for the company
Carclo reiterated full-year guidance despite year-to-date revenue running slightly behind prior year, citing margin and operating profit outperformance driven by strong Aerospace demand in its Speciality division and UK manufacturing growth. Net debt rose at end-July due to US property lease extensions and working capital timing, though management expects the working capital swing to reverse by end of Q2, leaving net debt (ex-leases) in line with FY26 year-end.
The company's ability to grow margins and operating profit on lower revenue suggests operational leverage is working, but the year-to-date revenue shortfall and near-term working capital headwind offset the margin story. Unchanged full-year guidance and expected net debt normalisation by half-year provide some reassurance, though the slow first quarter in CTP US and reliance on Aerospace cyclicality remain risks.
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