Morgan Advanced Materials PLC on Friday reported it had swung to profit in its full year, as its restructuring process paid off and margins were at their highest in decades.

The Windsor, England-based industrial products manufacturer swung to a pretax profit of £104.3 million in 2021, up from a loss of £13.1 million a year before. This was strong progress towards recovering pre-pandemic profit of £109.7 million in 2019, coming 4.9% short.

The company’s share price was up 12% to 313.50 pence each in London on Friday morning.

Revenue was up 4.4% year-on-year to £950.5 million, from £910.7 million. On an organic constant currency basis, revenue grew 10%, ahead of its November guidance of a range of 7% to 9% growth.

This figure however was 9.5% behind the £1.05 billion achieved in 2019.

Morgan Advanced said demand had recovered over 2021, following the ‘sharp slowdown’ in 2020 but the recovery of demand and the pandemic caused supply chain disruption and inflated costs of materials and labour.

However, it was able to offset these with pricing and improving efficiency, driving margins to the highest point in 20 years, it said. Adjusted operating margin was 13%, up from 10% in 2020. It concluded its restructuring programme in the year, which generated savings of £20 million.

It proposes a 5.9 pence final dividend, bringing the total for the year to 9.1p, up 65% from 5.5p in 2020. This is at a 3.0 times cover to adjusted earnings per share, which it has committed to maintain over the medium term.

It noted it had no significant dependence on materials from Russia or Ukraine, and that Russia made up less than 0.5% of its revenue at £4.0 million in 2021.

Looking ahead, it expects organic revenue growth between 4% to 7%, ‘assuming no significant change in market momentum’.

‘We will see higher inflation in 2022 and expect higher pricing and continuous improvement to offset this. We expect our margins to expand further reflecting the drop-through on our organic growth and the remaining full-year benefits from our restructuring programme,’ said Chief Executive Officer Pete Raby.

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