Last checked at 4 Sep 2018 07:00
4 September 2018
Severfield plc
('the Company' or 'the Group')
AGM trading update - outlook for FY19 unchanged
At the Company's Annual General Meeting, to be held today at 12.00 noon, Aldwark Manor Hotel, Aldwark, Alne, York YO61 1UF, the Chairman, John Dodds, will make the following statement.
Current trading and outlook
The Group's trading performance and financial position remains in line with management expectations and the outlook for the year ending 31 March 2019 remains unchanged. Following the higher profit from certain project completions in first half of the prior year, we expect the profits in the first and second half of the current year to be more equally weighted.
UK
The UK order book of £210m as at 1 September (1 June: £237m) remains in line with our normal order book levels, which typically equate to eight to ten months of annualised revenue. The order book reflects a higher proportion of smaller projects, particularly in the industrial and distribution sector, which typically have shorter lead times. Our pipeline of potential future orders has remained stable with a good balance of work across all key market sectors. Both the quality of the order book and the strength of the UK pipeline are consistent with our continued progress towards our strategic targets.
India
The Indian order book has increased again to £128m at 1 September (1 June: £106m). With this record order book, and a growing level of new opportunities, which includes a number of interesting higher margin commercial projects, the Indian business ('JSSL') is well positioned to take advantage of a market for structural steel in India which continues to improve.
As a result of these continued market improvements we have agreed with our joint venture partner, JSW, to increase factory capacity at the Bellary facility. The expansion will be financed by a combination of equity of c.£8m, provided in equal cash amounts of c.£4m by the Group and JSW, and debt of c.£8m, provided directly to JSSL by Indian lenders.
Half year results
The Group will announce its financial results for the half year ending 30 September 2018 on Tuesday 27 November 2018.
For further information, please contact:
Severfield Alan Dunsmore 01845 577 896
Chief Executive Officer
Adam Semple 01845 577 896
Group Finance Director
Jefferies International Simon Hardy 020 7029 8000
Will Soutar 020 7029 8000
Camarco Ginny Pulbrook 020 3757 4980
Tom Huddart 020 3757 4980
Notes to editors:
Severfield is the UK's market leader in the design, fabrication and construction of structural steel, with a total capacity of c.150,000 tonnes of steel per annum. The Group has four sites, c.1,300 employees and expertise in large, complex projects across a broad range of sectors. The Group also has an established presence in the developing Indian market through its joint venture partnership with JSW (India's largest steel producer).