TIDMHILS
RNS Number : 1595X
Hill & Smith Hldgs PLC
22 November 2017
22 November 2017
Hill & Smith Holdings PLC
Trading Update
Hill & Smith Holdings PLC ("Hill & Smith" or "the
Group"), the international group with leading positions in the
supply of infrastructure products and galvanizing services to
global markets, today issues a trading update covering the period 1
July 2017 to 31 October 2017 ("the period").
Current Trading
The Board is pleased to report that trading in the period was in
line with its expectations set out at the time of reporting the
Group's 2017 half year results in August.
Revenue for the period was GBP201.5m (2016: GBP189.6m, restated
to include non-US Pipe Supports*), a 4% organic increase after
adjusting for currency translation and acquisitions/disposals. The
positive translational impact of the strengthening of the US Dollar
and the Euro against Sterling increased revenue by 2% versus
average exchange rates in 2016. Underlying operating profit and
operating margin are ahead of the same period last year.
Markets - summary
Infrastructure - Roads
In the UK, as expected and previously reported, a small number
of road schemes have been delayed into 2018 resulting in lower
utilisation of our temporary safety barriers. We continue to expect
a ramp up in activity towards the end of the first quarter in 2018
and for utilisation to improve on 2017. The restructuring of our
Variable Message Signs business has proceeded to plan and trading
is in line with expectations. Demand for our hostile vehicle
mitigation security products, bridge parapets and lighting columns
remains strong.
We continue to make progress in our international markets with
Australia performing ahead of expectations. Elsewhere, USA and
Sweden delivered good results.
Infrastructure - Utilities
The performance of the UK Utilities companies continues to be
mixed with a lower year on year trading performance principally
driven by reduced volumes from our solar frame business.
In the US, both the transmission substation and composite
materials businesses performed well. On 22 August, we completed the
acquisition of the trade and assets of Tower Tech Inc. ("Tower
Tech"), a manufacturer of modular build, high efficiency composite
cooling towers which offer ease of installation, low operating
costs and longevity. Cash consideration of $3.1m was paid at
completion. Tower Tech is being integrated into our Creative
Pultrusions business, a long time supplier to Tower Tech, and
furthers our strategy of enhancing our product offering to end
users within infrastructure markets.
In India, our pipe supports business continues to experience
strong demand from international customers and the business
performed ahead of expectations. The US pipe supports business was
impacted by lower volumes and, despite the lower cost base from
recent consolidation of distribution centres, reported lower
profitability.
Galvanizing
Overall, revenue and profitability was ahead of the same period
last year. Higher zinc input prices were successfully passed
through to the end customer with the higher costs marginally
reducing operating margin. In France and the UK, volumes were 5%
and 4% ahead of the prior year respectively. Volumes in the USA
were 5% below the prior year, principally due to the large LNG and
solar projects running throughout most of 2016. Encouragingly,
excluding these large projects, volumes were 4% ahead year on
year.
Financial position
Net debt at 31 October 2017 was GBP110.9m compared to GBP109.1m
at 30 June 2017, principally reflecting acquisition spend plus the
continuing impact of high commodity prices on working capital.
Outlook
Derek Muir, Group Chief Executive, commented: "Overall,
conditions in many of our infrastructure end markets remain
favourable and we continue to expect the Group to report good
progress for 2017."
Financial calendar
The 2017 interim dividend of 9.4pence per share, announced on 10
August 2017, will be paid on 4 January 2018 to shareholders on the
Hill & Smith register on 1 December 2017. The ex-dividend date
is 30 November 2017.
The Group's preliminary results for the year ending 31 December
2017 are scheduled to be announced on 7 March 2018.
*In the Group's results to 31 October 2016 the post-announcement
trading results of the non-US Pipe Supports operations (revenue of
GBP4.6m) were treated as non-underlying items given their quantum
relative to the overall result for that period.
- Ends -
Cautionary Statement
This announcement contains forward looking statements which are
made in good faith based on the information available at the time
of its approval. It is believed that the expectations reflected in
these statements are reasonable but they may be affected by a
number of risks and uncertainties that are inherent in any forward
looking statement which could cause actual results to differ
materially from those currently anticipated. Nothing in this
document should be regarded as a profits forecast.
For further information, please contact:
Hill & Smith Holdings PLC
Derek Muir, Group Chief Executive Tel: +44 (0)121 704 7430
Mark Pegler, Group Finance Director
MHP Communications
Andrew Leach/Ollie Hoare Tel: +44 (0)20 3128 8100
Notes to Editors
Hill & Smith Holdings PLC is an international group with
leading positions in the design, manufacture and supply of
infrastructure products and galvanizing services to global markets.
It serves its customers from facilities principally in the UK,
France, USA, Sweden, Norway, India and Australia.
The Group's operations are organised into three main business
segments:
Infrastructure Products - Roads, supplying products and services
such as permanent and temporary road safety barriers, hostile
vehicle mitigation products, street lighting columns, bridge
parapets, temporary car parks and variable road messaging
solutions.
Infrastructure Products - Utilities, supplying products and
services such as pipe supports for the power and liquid natural gas
markets, energy grid components, composite 'GRP' railway platforms
and flood prevention barriers, plastic drainage pipes, industrial
flooring, handrails, access covers and security fencing.
Galvanizing Services which provides zinc and other coatings for
a wide range of products including fencing, lighting columns,
structural steel work, bridges, agricultural and other products for
the infrastructure and construction markets.
Headquartered in the UK and quoted on the London Stock Exchange
(LSE: HILS.L), Hill & Smith Holdings PLC employs some 4,200
staff, principally in 7 countries.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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