Severfield surges with record steelwork orders

In a trading update for the year to April, chief executive Alan Dunsmore said the order book has topped out at a record £479m, 22% up on six months ago.

The orders contain a healthy mix of projects across the group’s key market sectors, with £382m of work due for delivery over the next 12 months.

In terms of geographical spread, 94% of total orders are for jobs in the UK, with the remaining 6% representing projects for delivery in Europe and the Republic of Ireland.

Dunsmore said: “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 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.”

Net working capital increased in the second half reflecting the impact of steel and other input price rises, together with higher steel purchases to meet production requirements for the record orders.

Severfield’s year-end net debt was £19m, representing an overdraft of £4m and outstanding acquisition loans of £15m.

Dunsmore added: “With a record UK and Europe order book, 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.”

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