Member Article

Newly rebranded Severfield plc reports dip in revenue on last year but have narrowed pretax losses

Thirsk-based structural steel firm Severfield plc has reported a significant fall in revenue, but have improved their underlying profit on last year.

Revenue fell to £231.3 million for the year endng March 2014, whilst the group generated revenue of £318.3 million last year (which was reported as a 15 month period)

The firm posted a pre-tax loss of £4.1 million, down from a £28.9 million pre-tax loss over the previous reporting period covering the 15 months to 31 March 2013.

In May 2013, a further reorganisation of Severfield-Watson Structures (already having been restructured in January) was announced, resulting in the reduction in factory capacity by approximately 10% and 84 people lost their jobs.

The firm was hit by further losses from its Indian steelwork joint venture, with its share of losses growing to £3 million, up from £0.3 million over the previous period.

Factors affecting their results amortisation of acquired intangible assets £2.7 million (2013: £3.4 million) restructuring and redundancy cost £2.6 million (2013: £0.8 million) and the retirement of acquired intangible assets which cost the firm £2.4 million (2013: nil)

The firm has reported that their UK order book steady at £168 million at 1 May 2014 (1 November 2013: £172 million) and their India order book has increased to £41 million (1 November 2013: £34m)

Ian Lawson, chief executive officer commented: “During the financial year Severfield has achieved substantial operational improvements across the Group and delivered a significant turnaround in underlying profit before tax. Pleasingly, the Group’s ongoing stabilisation and recovery generated increasing UK operating margins supported by a strong balance sheet and solid order book.

“While our Indian joint venture performed below expectations, actions are being taken to put the business in a sustainable position and we believe the market in India continues to present significant future growth opportunities.

“The development of a clear Group strategy in addition to the anticipated recovery in the core UK market means Severfield is well placed for future growth.”

This was posted in Bdaily's Members' News section by Clare Burnett .