No recommendation
No news or research item is a personal recommendation to deal. Hargreaves Lansdown may not share ShareCast's (powered by Digital Look) views.
(Sharecast News) - Interim results from Severfield underwhelmed investors on Tuesday after the structural steel contractor pointed to ongoing subdued market conditions across the UK and Europe.
The firm reported an underlying pre-tax profit of 0.6m for the six months ended 27 September, significantly lower than the 16.1m earned last year, which it said reflected lower volumes and challenging conditions.
Analysts at Panmure Liberum, however, said they expected a "small loss to break even" result for the first half.
Revenues totalled 206.0m, down 18% over the year before, impacted by lower levels of activity across the business due to "subdued demand, some contract delays, and a sustained period of tighter pricing, particularly for near-term work".
Looking ahead, the market for structural steelwork across the UK and Europe remains "subdued" and a competitive bidding environment continues to drive tighter prices, the company said.
However, tendering activity is improving, and some "attractive large-scale projects [are] coming to market", it added.
The UK and Europe order book was 429m as of 1 November, slightly down from 444m the year before, of which 324m is for delivery over the coming 12 months.
At the same time, Severfield's Indian joint venture JSSL continues to grow strongly, growing revenues by 34% in the half and ending the period with a record order book.
The stock was down 8.7% at 27.2p by 1021 GMT.
The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website is not personal advice based on your circumstances. So you can make informed decisions for yourself we aim to provide you with the best information, best service and best prices. If you are unsure about the suitability of an investment please contact us for advice.