Melrose cautioned that problems revealed yesterday by US aero-engine maker Pratt & Whitney’s subsidiary Raytheon (RTX) might cost it as much as £200 million.
Pratt & Whitney said its GTF fleet had developed a problem caused by a rare condition in powder metal used to manufacture certain of its engine parts.
Melrose division GKN Aerospace has a 4% programme share on the GTF PW1100G variant impacted by this issue, the UK company said in a statement.
According to the announcement, the full potential cash impact to Melrose spread over the period to 2026 could be in the range of around.£200 million.
Melrose added its financial assumptions are conservative, recognising that most of the work is done on the delivery of GKN parts.
There is no change to profit and balance sheet guidance or the share buyback programme announced last week, the statement added.
Simon Peckham, Melrose's chief executive, said: "RTX indicated to us and the market yesterday that the GTF rare parts issue is within the scope they outlined previously and the cash impact is now assumed to be spread over a longer term."
Wizz Air yesterday said that the problem, which has affected engines on short-haul jets such as the Airbus 320, might reduce its flying capacity by 10% in the second half of 2024 due to the possibility of planes being grounded.
The airline said it would be seeking financial compensation from P&W for any disruption.
Shares in both Wizz Air and Melrose rallied today.
Wizz Air was up 2.6% at 2,005p and Melrose by 1.4% to 492.4p.