LONDON (Alliance News) - Van Elle Holdings PLC on Wednesday said it does not expect improvements in its performance in the second half of its current financial year following a sharp decline in its interim earnings.
The stock was trading down 33% on Wednesday morning at 53.55 pence a share.
The geotechnical engineering company reported a 55% fall in pretax profit to GBP2.4 million in the six months to the end of October from GBP5.3 million reported for the same period a year ago, as revenue dropped 18% to GBP42.9 million from GBP52.6 million.
Van Elle cut its interim dividend to 1.0 pence from 1.4p paid the year before.
The first quarter of the company's current financial year was relatively quiet, it said, as a result of subdued UK market conditions following a challenging period for the UK construction markets in early 2018.
Despite tat, the gross margin increased in the period to 32.8% from 31.7% reported a year earlier, reflecting several strong contract completions in the Specialist Piling division during the first half.
Van Elle Chief Executive Mark Cutler, who joined the company in August last year, has implemented a full review of the business and issued a three-phase transformation programme.
Under the plan, Culter intends to simplify the divisional structure of the company, while improving the operational project delivery and work performance.
"The third quarter has been more challenging than we anticipated," said Culter. "As a result, and despite good momentum being carried in from the first half, we don't believe we will be able to deliver the significant step up in performance during the second half."
Culter added: "Whilst we are mindful of the wider market environment, we are confident that the initiatives we are taking will develop a strong platform for future strong, profitable growth."
Van Elle (VANL)