Severfield’s full-year results show a strong order book for the UK and Europe and a steady project pipeline.
Despite rising steel costs, Severfield’s revenue has increased by 22% to £491.8 million, according to its full-year financial report ending in March 2023.
The firm’s UK and European order books of £510m reflect the high number of projects it is working on across its operations.
With the recent acquisition of European firm Voortman Steel Construction Holding BV (‘VSCH’), Severfield aims to expand further into Europe and stabilise inflation-led supply chain interruptions.
In 2023, the firm and its Indian joint venture with JSW Steel, JSSL, recorded an output of more than 100,000 tonnes, respectively.
Severfield pre-tax underlying profit rose by 20% to £32.5 million, with an operating cash conversion of 145%.
Consequently, the company board recommends a 10% increase in dividend share price to 3.4p per share for the year.
Full scope of projects
Last year Severfield reduced its core construction operations from six divisions to three to align with the demand of the 10 market sectors it serves.
These new divisions include the following:
- Commercial and Industrial (C&I).
- Nuclear and infrastructure (N&I).
- Modular solutions (SMS).
Throughout the year, Severfield continues to work on several commercial projects, including the Google Headquarters at King’s Cross and the new Everton F.C. stadium, which will complete construction in July.
The order book for this division stands at £372 million and includes the firm’s recent appointments to the Etihad North Stand and Hertswood Studios.
On the nuclear side, Severfield is a part of decades-long energy projects, providing steel structure packages for the 10-year construction of Hinkley Point C and the 20-year Project Partners (‘PPP’) framework for projects in Sellafield.
In parallel to these divisions, SMS is a new addition used to grow its modular product ranges, namely in Construction Metal Forming (CMF) and cold-rolled steel.
One of Severfield’s business focuses in this division is Rotoflo, a silo discharge system that handles dispersible solids like paint.
The firm aims to use this system in the UK water treatment sector, with future expansion into waste-water treatment in the UK, US, India and Australia.
Severfield plans on growing its revenue this year with a secured workload across its divisions and expanding its services overseas, mainly in Europe and India.
The company launched Project Horizon in 2023, its self-funded digitisation scheme, using automation and software development to standardise more than 100 project workflows across the Group.
“2023 was a very successful year for the Group. We reported record revenue, delivered underlying profits ahead of expectations and secured a significant value of new, high-quality work across all our geographies,” said CEO Alan Dunsmomre.
“This demonstrates the success of our strategy to diversify the sectors and geographies we serve, reflects the high quality of our operations and is a testament to the talent and commitment of our people.”
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