UK car parts supplier Dowlais Group PLC (LSE:DWL) reported a decline in sales in the first quarter but said it does not expect US tariffs to have a material direct effect on its full-year performance as it anticipates fully recovering additional costs from customers.
The FTSE 250-listed group reported a 3.9% year-on-year decline in adjusted revenue to £1.3 billion for the first quarter of 2025, or a 2.5% decline if currency swings were ignored, reflecting lower sales volumes.
The group’s adjusted operating margin improved by 80 basis points to 6.6%, supported by ongoing restructuring initiatives.
Automotive revenues fell 1.5% to £1 billion, with 3.9% growth in the ePowertrain segment for electric and hybrid vehicles and an 11% rise in revenue from its China joint venture, offset by a 6.6% decline in Driveline revenue, impacted by adverse customer mix and the phase-out of older programmes.
Powder Metallurgy revenue fell 5.7%, with an operating margin of 8.3%, down 150 basis points due to reduced volumes.
Dowlais now expects its full-year performance to be towards the low end of its guidance range, citing continued market volatility and lower industry forecasts for light vehicle production.
"Performance in the quarter was in line with expectations, with the results reflecting our geographically diversified portfolio, continued focus on executing against our global footprint restructuring programs and ongoing performance initiatives," said Liam Butterworth, CEO of Dowlais.
Shares rose 1.3% on Thursday morning.