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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Severfield Plc | LSE:SFR | London | Ordinary Share | GB00B27YGJ97 | ORD 2.5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.60 | -0.88% | 67.60 | 67.20 | 67.80 | 69.80 | 67.80 | 69.80 | 206,123 | 16:35:13 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Structural Steel Erection | 493.61M | 21.57M | 0.0697 | 9.73 | 209.87M |
TIDMSFR
RNS Number : 6604I
Severfield PLC
20 April 2022
20 April 2022
Severfield plc
('the Company' or 'the Group')
Pre-close trading update
Order books at record levels
Severfield plc, the market leading structural steel group, today issues the following trading update for the year ended 31 March 2022, ahead of the announcement of its annual financial results on Wednesday 15 June.
FY22 expectations
The Group expects to deliver a full year result in line with management's previous expectations.
Operational and trading update
UK and Europe
In the second half of the year, we have continued to secure a significant value of new work, resulting in a record UK and Europe order book of GBP479m at 1 April 2022 (1 November 2021: GBP393m), of which GBP382m is for delivery over the next 12 months. The order book remains well-diversified and contains a healthy mix of projects across the Group's key market sectors. In terms of geographical spread, 94 per cent of this order book represents projects in the UK, with the remaining 6 per cent representing projects for delivery in Europe and the Republic of Ireland.
We continue to be encouraged by the current level of tendering activity across the Group, both in the UK and in continental Europe, and are well-positioned to take advantage of some significant opportunities in the industrial and distribution (battery plants and distribution centres), stadia and leisure, transport infrastructure, nuclear and data centre sectors.
Despite seeing further input cost inflation (including in steel prices) and some disruption to raw material supplies as a result of Russia's invasion of Ukraine, we are currently managing these effectively, and steel remains largely a pass-through cost for the Group.
India
The Indian joint venture ('JSSL') has performed profitably and in line with expectations in the second half of the year. This follows a difficult start to the year when output was disrupted by the second wave of COVID-19. Notwithstanding some current inflationary pressures, JSSL has continued to win new work, resulting in a record order book of GBP166m at 1 April 2022 (1 November 2021: GBP140m). In terms of mix, 40 per cent of the order book represents higher margin commercial work, with the remaining 60 per cent representing industrial projects, mainly for JSW. This order book, together with JSSL's improving pipeline of potential orders, reflects a continuing strong underlying demand for structural steel in India, leaving the business very well-positioned to take advantage of an improving economy.
Strong balance sheet and financial position
The financial position of the Group remains good and year-end net debt (on a pre IFRS 16 basis) was c.GBP19m, representing an overdraft of c.GBP4m and outstanding acquisition loans of c.GBP15m. Net working capital has increased in H2 reflecting the impact of steel and other input price rises, together with higher steel purchases to meet production requirements in early FY23 when executing our record UK and Europe order book.
In December 2021, the Group completed a refinancing of its revolving credit facility ('RCF'). The new GBP50m RCF provides additional liquidity above the GBP25m RCF which it replaced and extends the term of the facility which now expires in December 2026. The new facility provides the Group with enhanced liquidity and long-term financing to help support its growth strategy.
Outlook
With a record UK and Europe order book of GBP479m, a very encouraging pipeline of opportunities, and a well-positioned business in India, the outlook for the Group remains positive, although we remain mindful of the ongoing effects of Russia's invasion of Ukraine.
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
Liberum Capital Nicholas How 020 3100 2000
Ben Cryer 020 3100 2000
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.165,000 tonnes of steel per annum. The Group has six sites, c.1,500 employees and expertise in large, complex projects across a broad range of sectors. The Group also has an established presence in the expanding Indian market through its joint venture partnership with JSW Steel (India's largest steel producer).
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April 20, 2022 02:00 ET (06:00 GMT)
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