Engineering giant GKN was “mugged” by a profit warning today after a sudden £40 million hit to its car and planes business, and a squeeze in the US, sent shares tumbling.
The FTSE 100 firm was forced to disclose two looming claims in the Aerospace and Driveline division but refused to say any more because they were “commercially sensitive”. Chief executive Nigel Stein described them as “discrete” events and said they did not relate to litigation.
The charge will hit results next quarter.
Explaining the hit to analysts, he said: “Frankly, this feels like we’re walking down the street and we’ve been mugged. When we came in on Tuesday we didn’t expect to be sitting here today.”
Lower production at its plane parts plant in Alabama will also give its aerospace unit’s results a £15 million hit.
Shares had their worst day in eight years falling 9.5% at the opening before paring settling down 26.8p, or 7.6%, at 326p by mid-morning.
Stein will stand down from the group at the end of the year, replaced by GKN aerospace chief Kevin Cummings.