Interim Management Statement

RNS Number : 0340H

Hill & Smith Hldgs PLC

14 May 2014

 



14 May 2014

Hill & Smith Holdings PLC

Interim Management Statement

Hill & Smith Holdings PLC ('Hill & Smith' or 'the Group') is an international group with leading positions in the supply of infrastructure products and galvanizing services to global markets, today issues its Interim Management Statement covering 1 January 2014 to 14 May 2014 (the "period").

Trading - positive momentum maintained

The Board is pleased to report that trading continues to be in line with its expectations. Overall, demand in the Group's markets has been consistent with that at the time of the announcement of the 2013 preliminary results, with the momentum seen in the second half of 2013 continuing into the period.

Markets - summary

Infrastructure - Roads

As previously communicated, the demand for permanent and temporary road barriers in the UK continues to gain momentum as the Highways Agency escalates spending as part of its plan to increase investment in the strategic road network through to 2020.

Infrastructure - Utilities

In the USA, trading in our composite materials operation remains strong although the improved profitability has been offset by a lower contribution from our transmission substations business, principally caused by severe weather related issues at the start of the year. Our pipe supports businesses in the USA are seeing an improving backlog and enquiry levels as more projects for gas-fired power stations, fertilizer, LNG and petrochemical plants begin construction. Overall, the pipe supports operations are performing at improved levels compared to 2013. As expected our remaining businesses in the UK have seen increased demand in their niche end markets.

Galvanizing

Underlying galvanizing volumes, up to 30 April, are 7% ahead of the same period in 2013. The USA has seen an increase in the lower margin solar and transmission pole work, whilst other end markets remain stable. In France volumes are also ahead of 2013 with sales to the smaller customers strong, although pricing pressure is apparent due to the lack of large project work in the market. In the UK we have seen a slower start to the year in structural steel volumes, offset by higher demand for our own internally manufactured products and the continued outperformance of the Medway business we acquired last year.

Financial position

Net debt at 30 April 2014 was £101.3m compared to £87.1m at the 31 December 2013, reflecting both the seasonality of working capital and the increasing level of capital investment in organic growth initiatives.

The Group today announces that it has amended and extended its syndicated revolving credit facility. The £210m multi currency facility has been amended on favourable terms and its term extended by 3 years to 26 April 2019. The financial covenants remain unchanged and the new facility will be effective from 2 June 2014.

Outlook

On the outlook Derek Muir, Group Chief Executive, commented:

"As reported at the time of our preliminary results in March, the Board expects good constant currency revenue and profit growth to continue, although our reported results will be impacted by adverse foreign currency translation. Our markets remain active and with our strong niche positions in those markets, combined with our geographical representation, we are positioned to make further progress during 2014, in line with our expectations."

Financial calendar

The proposed 2013 final dividend of 10.0 pence per share, announced on 11 March 2014, will, subject to shareholder approval, be paid on 4 July 2014 to shareholders on the Hill & Smith register on 30 May 2014. The ex-dividend date is 28 May 2014.

The Group's interim results for the six months ending 30 June 2014 are scheduled to be announced on 5 August 2014.

- Ends -

Cautionary Statement

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:  [phone]

Mark Pegler, Group Finance Director

MHP Communications

John Olsen/Barnaby Fry/Vicky Watkins                                                 Tel:  [phone]

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 Australia, France, India, Sweden, Thailand, the UK and the USA.

The Group's operations are organised into three main business segments:

Infrastructure Products - Utilities, supplying products and services such as pipe supports for the power and liquid natural gas markets, energy grid components, "GRP" railway platforms and flood prevention barriers, plastic drainage pipes, industrial flooring, handrails, access covers and security fencing.

Infrastructure Products - Roads, supplying products and services such as permanent and temporary road safety barriers, street lighting columns, bridge parapets, gantries, temporary car parks, variable road messaging solutions and traffic data collection systems.

Galvanizing Serviceswhich 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 3,600 staff across 50 sites, principally in 7 countries.

 

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