Steelwork contractor says bottom line up nearly one third
Turnover at the steelwork firm helping build Everton’s new stadium, new studios for broadcaster Sky in Hertfordshire and new viaducts for HS2 in the West Midlands topped £200m in the first six months of the year.
Severfield said revenue was up 20% to £235m in the half year to 24 September after a record-breaking 12 months last year where income topped £400m for the first time.
The country’s biggest steelwork contractor said pre-tax profit was up 29% to £10.2m which it said “highlights our ability to offset ongoing inflationary cost increases through a combination of operating efficiencies, higher selling prices and contractual protection as steel remains largely a pass-through cost for the group”.
It said its income during the period included around £23m of steel price increases and it said rising steel prices, “supply constraints on certain materials and increased energy and labour costs have continued to drive upward pressure on total build costs” in the first half which it added would continue for the remainder of its financial year.
It said its order book at 1 November stood at £464m, down from the £486m at the beginning of June, with £367m planned over the next 12 months.
The firm, whose ongoing projects include work on Lendlease’s new Google headquarters building at King’s Cross as well as Bam’s Co-op Live Arena in Manchester and Multiplex’s Argyle Street office scheme in Glasgow, said net debt at half year was £15.8m, down from the £18.4m it posted at the end of its last financial year.
The firm’s joint venture in India, JSSL, which has been up and running since 2008, posted an after tax profit with Severfield’s share of the figure standing doubling to £600,000. Revenue at the business was up 70% to £70m.
Analysts are expecting full-year revenue of around £490m with pre-tax profit to be just over £31m.
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