Goodwin Shares Fall 4.7% on Polyimide Plant Production Bottleneck

Shares in Goodwin PLC (LON:GDWN) fell 4.7% after the engineering company disclosed a significant production bottleneck at its new polyimide plant, leading to a wider loss in the unit. The negative development overshadowed a strong performance in its overseas refractory business, according to a September trading update for the four months ended August 31, 2026.

Duvelco Production Woes

The primary concern for investors centered on Goodwin's Duvelco polyimide business, where a mechanical issue in the final drying stage has constrained output to just 20% of the plant's designed capacity. This bottleneck, identified during commissioning, represents less than 12% of the total manufacturing process but is severely limiting throughput.

As a result, Duvelco recorded a loss of £1.7 million for the period, a substantial increase from the £592,000 loss in the same period last year, which the company attributed primarily to depreciation on new manufacturing assets. Goodwin stated that the proposed solution, a new dryer, has an indicated lead time of approximately ten months, though it is exploring ways to shorten this timeline. Despite the production issues, the company noted that the product being manufactured is "technically competitive with the world market leader."

Mixed Refractory Performance

In contrast to the challenges at Duvelco, the company's refractory operations delivered robust growth. Key performance figures include:

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• Overseas refractory businesses saw profits increase 19% year-over-year to £3.1 million.
• AVD Fire Ltd and Dupré Minerals delivered combined profits of £1.0 million, up 30% year-over-year.

However, the UK powder operations faced headwinds. Planned maintenance took a calciner offline at Hoben International for approximately 11 weeks, while elevated gold and silver prices negatively impacted demand at Goodwin Refractory Services.

Strategic Divestment on Track

Goodwin also confirmed it is proceeding with its previously announced agreement to sell a substantial part of its Mechanical Engineering Division to an affiliate of Cerberus. The deal has a headline cash consideration of up to approximately £1.1 billion and is expected to be completed in the first quarter of 2027, subject to regulatory approvals. The company anticipates that no UK corporation tax will be payable on the disposal gain.