TI Fluid Systems PLC (LON:TIFS) flowed higher on Wednesday after the car parts maker posted a sharp rise in profits in its first year as a listed company and hiked its annual dividend.
The company, which made fuel lines for the Model T Ford back in the 1920s and now counts Aston Martin among its customers, generated revenue of €3.47bn in 2018, which, after accounting for currency movements, was 2.0% higher than in 2017.
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Pre-tax profits surged to €217.1mln (2017: €158.0mln), although 2017’s bottom line was dented by €40mln worth of costs associated with the initial public offering.
Free cash flow generation also surged in the period, climbing 23.3% to €146.2mln (€119mln). That was better than bosses had expected and reflected lower interest payments and the timing of some customer payments.
Given the solid performance, bosses proposed a final dividend of 5.94 euro cents, taking the total payout for the year up to 8.96 euro cents.
TI, which is developing fluid systems for the burgeoning electric vehicle market, paid 1.31 euro cents for the two-and-a-half months it was trading on the London Stock Exchange in 2017.
Growth achieved despite slowing car production
“2018 was a great year for TI Fluid Systems,” said chief executive William Kozyra.
“Despite a slight softening in global light vehicle production growth, we achieved strong organic growth, solid profit margins and free cash flow generation.”
He added: “The excellent progress delivered in executing our hybrid electric vehicle and electric vehicle strategy in 2018, as well as our approach of continued and disciplined organic growth has positioned the group well for 2019 and beyond.”
Shares rose 8% to 185.7p on Wednesday morning.