Severfield (SFR) H1 2025 earnings summary

Executive summary

• Revenue grew 17% year-over-year to £252.3m, with underlying profit before tax up 14% to £16.1m, reflecting strong project delivery and a diversified order book.

• Statutory results impacted by a £20.4m non-underlying charge for bridge remedial works, resulting in a statutory pre-tax loss of £5.8m.

• Challenging market backdrop in UK and Europe with tighter pricing, project delays, and cancellations impacting short-term profitability.

• India joint venture saw lower H1 profits due to project delays but maintains a record order book and accelerated expansion plans.

• Interim dividend maintained at 1.4p per share, with additional capital returns via a £10m share buyback programme.

Financial highlights

• Group revenue increased 17% year-over-year to £252.3m; underlying operating profit up 16% to £17.2m.

• Statutory loss before tax: £5.8m, reflecting non-underlying bridge costs.

• Core Construction revenue up 19% to £247.2m; Modular Solutions revenue down 8% to £9.8m.

• India JV revenue at £49.3m, with lower profits due to project delays and sub-optimal work mix.

• Underlying EPS: 4.0p; basic loss per share: 1.4p.

Outlook and guidance

• Full-year profits now expected to be below previous expectations due to market and operational headwinds.

• Market remains challenging with tight pricing and delayed/cancelled projects for FY25 and FY26.

• India: well-positioned for significant growth, with expansion plans underway and a record order book.

• Medium-term growth targets remain unchanged, with confidence in long-term prospects.