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Boeing supplier Senior resumes dividend as air travel boom swells profit

By Eva Mathews

(Reuters) -British auto and aircraft parts supplier Senior Plc on Monday resumed dividend payouts after a more than six-fold rise in first half adjusted profit as planemakers ramp up production to serve the post-pandemic recovery in air travel.

Revenue increased 16% to 402.2 million pounds ($489.80 million) in the six months to June 30, with adjusted profit before tax rising to 8.8 million pounds.

The company stuck to its full-year forecast, reflecting higher production of narrow-body jets, U.S defence demand and a recovery in wide-body jet production for long-haul routes expected towards the end of the year.

"We will see more strong growth in 2023," Group Chief Executive David Squires told Reuters, adding second half performance will be in-line with the first half.

Boeing resuming deliveries of its 787 Dreamliner is also set to boost growth, Squires said, as planemakers also replace older models with more fuel efficient ones.

An interim dividend of 30 pence per share will be the first paid by the company since it scrapped payouts in March 2020, already reeling from the fallout from Boeing's 737 MAX crisis as the pandemic grounded global air travel.

The company, which supplies parts such as airframes and engine build-up tubes to planemakers, also counts Airbus among its customers.

Major aerospace companies have sounded the alarm on their supply chains with shortages of raw materials and components crimping the industry's ability to capitalise on roaring travel demand.

Senior, which relies on the industry for 40% of its revenue, said profit before tax fell to 11.1 million pounds in the first-half from 22.3 million pounds a year earlier, hurt by rising inflation and also chip supply constraints in the auto industry.

Squires said, however, signs of easing supply chain pressures for automakers was good news.

"The group has significant recovery potential, and the growth opportunities across both divisions appeal," Jefferies analysts said.

($1 = 0.8212 pounds)

(Reporting by Eva Mathews in Bengaluru; editing by Uttaresh.V, Kirsten Donovan)