Engineering consultancy reported revenue up 9% to £91m
Companies: Waterman Group
Waterman Group plc, the engineering and environmental consultancy, has announced strong Preliminary Results for the year to 30 June this morning, reporting revenue up 9% to £91.3m, and adjusted operating profit margin up 4%. The company's net funds have "significantly" improved by 45% to £5.5m (after paying shareholder dividends of £0.7m).
Waterman says it generates 90% of revenue from the UK, with its key markets remaining strong during the period:
"...key markets being retail, commercial, residential and highways. Client demand in these markets has remained strong and this has contributed to our revenue and profit margin increase during the period. Our UK Group has increased revenue by 9% to £81.4m (2015: £74.5m)."
Overseas, the group has offices in Ireland, Australia and Poland, and has experienced a mixed set of results for those countries. Overall demand for its International Group has increased by 5% to £9.9m.
City stockbroker N+1 Singer said that Waterman results are in line with expectations, and exceeded the Board’s ambition to triple PBT in three years:
"Net cash was a touch ahead of forecast at £5.5m (£5.4m f/c) and the dividend was 3p, in line with the stated progressive policy. There has been no significant change in trading activity since the EU referendum but, with the order book consistent with the prior year level of £130m, we consider it prudent to assume a year of consolidation in FY17 with growth to resume in FY18. This results in forecast PBT reductions (–c.20% in FY17 and FY18) but we leave our FY17 DPS forecast unchanged at 4p, noting the strength of the balance sheet and management’s confidence in medium term prospects."
The company announced another increase in its total dividend raising it to 3p, up from 2p last year, which is covered 2.5 times by adj earnings. This is the latest in a series of dividend increases over the last three years, which has increased the annual dividend 6 times.
CEO Nick Taylor said:
"Waterman is in excellent shape, having reported results which exceed its previously declared financial objectives over the three year period to 30 June 2016 of tripling adjusted annual profit before tax to £3.3m, delivering £3.6m and increasing Return on Capital Employed to over 20%, delivering 47%.
Over the last three years, the Group has delivered a six times increase in the annual dividend paid to shareholders to 3.0p from 0.5p and during the same period, after paying shareholders dividends of £1.4m, net funds have increased to £5.5m from £1.1m."