Severfield has reported a rise in profits, despite a contraction in revenue.
The Yorkshire-based company, which fabricates, fabricates and assembles steel for projects across the UK and beyond, made a pre-tax profit of £11m in the six months to 23 September of this year This was up 8% on the equivalent period in 2022, although revenue fell 8% over the same period to £215.3m.
Severfield told investors it had “performed well” over the past half-year, which was marked by “difficult market conditions”.
The company said the economic climate had led to “continued delays” in awarding contracts, as well as “some lower bidding activity and competitive pricing”. But its UK and European order book stood at £482m on November 1, of which two-thirds were delivered in the following 12 months and almost nine-tenths were UK-based.
“Many of our chosen markets continue to have a favorable outlook with excellent long-term growth opportunities,” the trading update said.
“The group has a prominent position in market sectors with strong growth potential and is well positioned to win projects in support of a low-carbon economy and to improve energy security.”
Targeted schemes included battery plants, energy-efficient buildings, renewable energy manufacturing facilities and work in the transport, nuclear, oil, gas and power sectors, according to the update.
Severfield bought Dutch manufacturer Voortman Steel Construction in the last period and said the move offered “greater access to growing European market sectors”.
The acquired company has delivered revenue of £28m and pre-tax profit of £1.5m in its first six months, the update revealed.
Severfield chief executive Alan Dunsmore said: “During the period we grew profits, successfully integrated Voortman, reported strong cash generation and continued to strengthen our balance sheet.
“We have secured a significant amount of high-quality new work across a range of sectors in the UK, EU and India.”
