The stock is up 10% with the news full-year results are expected to be comfortably ahead of expectations.
Companies: Severfield Plc
Some good news from the Severfield (LON: SFR) camp this morning as the structural steel company reports its Interims which show strong figures for the first half of FY18.
H1 Revenues are up 16% to £137m and Underlying PBT is up 59% to £12.9m. An Interim dividend of 0.9p per share will also be issued, up 29% from the 0.7p per share in H1 17.
The Group is responsible for some of London's largest current commercial projects, including the new Tottenham Hotspur F.C stadium, the new retractable roof at Wimbledon centre court, and a commercial tower at 22 Bishopsgate.
Thanks to the strong start to FY18 Management said full-year results are now expected to be "comfortably ahead of previous expectations".
The Group, who account for c. 17% of all structural steel production in the UK, set a 2016 target of doubling its Underlying PBT to £26m by 2020.
With an order book of over £320m, the Group is well positioned to achieve this target.
SFR shares jumped 10% early this morning as a result of the positive figures whilst corporate broker N+1 Singer has released a note, saying:
"We are confident that Severfield is on its way to achieving its target to double PBT by FY’20 (from £13.2m in FY’16). We expect to upgrade our current year PBT forecast by 11% to c.£23.5m. Trading on an FY’18 P/E multiple of 9.7x (post upgrades), we believe that Severfield is attractively valued vs. peers."
With today's price hike SFR trades at 71p and trades at a forecast PE ratio on par with the industry median of 10x. Prior to today's results consensus forecast Net Profits of c. £17m and £19m in FY18 and FY19 respectively.
