Dowlais Group PLC (LSE:DWL) is considering putting its powder metallurgy business up for sale after warning that a recovery in the second half would not materialise.
Formerly the auto and powders arms of GKN, Dowlais saw revenues drop 10% to £2.29 billion in the half year to end June 2024 with adjusted profits down by a third to £95 million and a statutory loss of £123 million.
Falling EV sales hit its ePowertrain business, while hydrogen losses were £7 million ahead of its disposal announced today.
A strategic review of powder metallurgy is underway, it added, with one option to sell the business.
Trading overall remains subdued, it added, with ePowertrain sales to be affected in the second by falling demand.
As a result, Dowlais expects its annual sales to drop by mid-to-high single digits with operating margins of between 6-7%.
“In this challenging market environment, we focused on what we can control and took several decisive actions to mitigate the impact from lower volume as well as unlock value from our portfolio,” said Liam Butterworth, chief executive.