22 November 2018
Hill & Smith Holdings PLC
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 2018 to 31 October 2018 ("the period").
The Board expects full year 2018 results to be in line with current market expectations.
Revenue for the period increased by 11.5% to £224.7m (2017: £201.5m). After adjusting for currency translation and acquisitions, the organic increase was 5%. The negative translational impact of the strengthening of Sterling against the US Dollar in particular decreased revenue by 2% versus average exchange rates in 2017. Underlying operating profit for the period was ahead of the same period last year.
In October, the Group was encouraged to hear the announcement of further significant investment in the UK roads network. Confirming funding for its Road Investment Strategy 2 ("RIS2") programme, the UK Government increased investment across 2020 to 2025 to £25.3billion, an increase of some 66% compared with the RIS1 programme spanning 2015 to 2020. The delivery of Smart Motorways, in which the Group has an active and significant presence, continues to lie at the core of the Government's investment in the strategic road network.
During the period the Group completed two acquisitions for a total consideration of $18.6m. On 17 August, the Group acquired the business assets of Engineered Endeavours Inc. from Chapter 11 proceedings in Ohio, USA for a cash consideration of $6.4m. The business designs and manufactures utility poles for the power distribution and wireless cellular markets and gives us 52,000 sq. ft. of additional manufacturing capacity in our existing US utility business.
The business and assets of Composite Advantage Inc. ("CA") were acquired on 5 October for an initial cash consideration of $10.6m. A further $1.6m is due on the expiry of certain warranties and indemnities. Based in Ohio, USA, CA provides fibre reinforced polymer products for infrastructure markets including waterfront, rail, bridge decks and oil & gas. CA is being integrated into the Group's existing composite products business and will expand the range of technical solutions into wider infrastructure markets. Neither acquisition is expected to materially contribute to the 2018 results.
Net debt at 31 October 2018 was £152.6m compared to £141.2m at 30 June 2018, principally reflecting further acquisition spend.
The 2018 interim dividend of 10.0 pence per share, announced on 8 August 2018, will be paid on 3 January 2019 to shareholders on the Hill & Smith register on 30 November 2018. The ex-dividend date is 29 November 2018.
The Group's preliminary results for the year ending 31 December 2018 are scheduled to be announced on 6 March 2019.
- Ends -
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
Andrew Jaques / Ollie Hoare Tel: 44 (0)20 3128 8771
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, traffic management 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' products, 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 4,400 staff, principally in 7 countries.