REG - Hercules PLC - Interim Results
17/06/2025 07:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250617:nRSQ0779Na&default-theme=true
RNS Number : 0779N Hercules PLC 17 June 2025
17 June 2025
Hercules plc
("Hercules" or "the Company")
Interim Results
Growth demonstrating clear evidence of progress
Hercules plc (AIM: HERC), a leading technology enabled labour supply company
for the UK infrastructure and construction sectors, is pleased to announce its
unaudited interim results for the six months ended 31 March 2025 ("H1 2025").
Continuing Operations - Financial Highlights:
● Record revenue, and growing adjusted EBITDA and PBT in H1 2025 driven by
labour supply division:
· Record revenue achieved, increased 18% to £54.6m (H1 2024: £46.2m)
· 24% increase in Adjusted* EBITDA to £2.6m (H1 2024: £2.1m)
· 55% increase in Adjusted** pre-tax profit to £1.7m (H1 2024: £1.1m)
· 19% increase in Adjusted** EPS to 2.11p (H1 2024: 1.77p)
● Cash of £9.8m as of 31 March 2025 (H1 2024: £1.7m)
● Interim dividend of 0.6p declared (H1 2024: 0.6p)
Operational highlights:
● Suction Excavator subsidiary sold, for a total gross cash consideration of
£2.3m. The divestment materially reduced the Company's debt and lease
liabilities by approximately £9m
● Labour supply division has seen a 31% year-on-year increase in revenue
● Across all labour supply sites operative numbers continued to see steady
growth
● Civil Projects division has won £12m of project contracts since the start of
FY 2025
● New clients gained with a high level of tenders completed in the period
● The Company is already supplying labour to the early works phase of the
Sizewell C nuclear plant. Following the Government's recent approval
announcement, the Board believes Hercules will continue to support the project
through its main construction phase, expected to span up to 20 years, with an
estimated total cost of £30 billion
● The Hercules Academy has trained over 1,500 people since launch and is
delivering in line with expectations
Outlook:
● With solid operational momentum, a healthy pipeline, and a positive outlook
across the infrastructure sector, with committed spend between £700bn -
£750bn for the next 10 years, the Board is confident in meeting market
expectations for the full year
Post-period Highlights:
● Secured a place on the Wessex Water Civils Support Framework
● In May, the Company announced that it had changed its name to Hercules plc
● In June, successfully completed the acquisition of the business and assets of
Quality Transport Training Ltd (QTT)
*Adjusted EBITDA definition - earnings before interest, tax, depreciation,
amortisation, profit/loss on sale of fixed assets, exceptional items and
Research & Development expenditure.
**Adjusted pre-tax, post-tax profit & EPS definition - same adjustments as
for EBITDA but also excluding extraordinary impairment and goodwill
amortisation.
Brusk Korkmaz, Chief Executive Officer, commented: "Hercules is going from
strength to strength, achieving further growth in the first half of FY 2025.
We delivered record revenue and increased pre-tax profit and Adjusted EBITDA
versus the same period last year, demonstrating clear evidence of our
progress.
"During the period, we increased our supply of skilled operatives across key
infrastructure projects, such as Sizewell C, while securing new labour supply
frameworks that will support our long-term growth.
"Our progress is a testament to the strength of our management team, whose
ambition and focus is driving the business forward. Progress we expect to
continue as the UK carries out substantial construction and infrastructure
upgrades within the nuclear, power and energy distribution, aviation, water,
and rail sectors.
"With solid operational momentum, a healthy pipeline, and a positive outlook
across the infrastructure sector, we remain confident in meeting market
expectations for the full year."
Investor Presentation
CEO Brusk Korkmaz and CFO Paul Wheatcroft will deliver a live presentation
regarding the Company's Interim Results via the Investor Meet Company platform
today at 11.00am (BST).
The presentation is open to all existing and potential shareholders. Questions
can be submitted via the Investor Meet Company dashboard at any time during
the live presentation. Although the Company may not be able to answer every
question it receives, it will address the most prominent within the confines
of information already disclosed to the market. Responses to the Q&A from
the live presentation will be published at the earliest opportunity on the
Investor Meet Company platform.
Investor feedback can also be submitted directly to management post-event to
ensure the Company can understand the views of all interested parties.
Investors can sign up to Investor Meet Company for free and add to meet
Hercules plc via:
https://www.investormeetcompany.com/hercules-plc/register
(https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.investormeetcompany.com%2Fhercules-plc%2Fregister&data=05%7C02%7CRobin.Tozer%40secnewgate.co.uk%7Ccf621ddcdd5a46604f9708dda75aaebd%7Ceae0b4d670d04d12a2336addd6e076a0%7C0%7C0%7C638850730142088031%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&sdata=nIjYH9fwjkMJGvnUTsubR6UahSMDE9LEZZShyiUwp9w%3D&reserved=0)
Investors who already follow Hercules plc on the Investor Meet Company
platform will automatically be invited.
For further information and enquiries, please contact:
Hercules plc c/o SEC Newgate
Brusk Korkmaz (CEO)
Paul Wheatcroft (CFO)
+44 (0) 20 3470 0470
SP Angel (Nominated Adviser and Broker)
Matthew Johnson / Adam Cowl (Corporate Finance)
Grant Barker / Rob Rees (Sales and Broking)
SEC Newgate (Financial Communications) +44 (0) 20 3757 6882
Robin Tozer / Ian Silvera / Nina Renata Pop Hercules@secnewgate.co.uk
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 which has been incorporated into UK law by the European
Union (Withdrawal) Act 2018.
Chairman's statement
Further Growth and Strategic Progress
Hercules has achieved further growth in the first half of FY 2025. Revenue for
the period increased by 18% year-on-year to £54.6m, a record. Growth has been
driven organically across all areas of the business, underpinned by a further
acceleration in labour supply activity across our cornerstone infrastructure
projects, such as HS2 and Sizewell C. Furthermore, in June, we were pleased to
announce the successful acquisition of the business and assets of Quality
Transport Training Ltd (QTT).
Given the development of the Company, the Board felt the time was right to
simplify our brand. From May, we officially changed the Company's name to
Hercules to reflect a business which is focused on labour supply and expanding
our blue and white-collar labour supply services in the UK construction and
infrastructure sectors.
Favourable Market Conditions
The outlook for the infrastructure sector remains positive, supported by
strong market fundamentals and a resilient nationwide project pipeline.
With macroeconomic indicators suggesting a gradual improvement in the UK
economy, including the prospect of lower interest rates, we anticipate
increased momentum as the UK carries out substantial construction and
infrastructure upgrades within the nuclear, power and energy distribution,
aviation, water, and rail sectors.
While the sector continues to experience a shortage of skilled operatives, our
ability to meet client requirements remains unaffected. Leveraging our
proprietary digital platform, we can efficiently source, match, and deploy
operatives locally. This positions Hercules to capitalise on increased market
demand. Meanwhile, our complementary construction services are gaining
traction, and our pipelines across both divisions remain robust.
Financial Results Show Progress in Line with Expectations
Revenue for the period grew by 18% to £54.6m (H1 2024: £46.2m). Gross profit
increased 11% to £7.8m (H1 2024: £7.0m).
Adjusted EBITDA was £2.6m (H1 2024: £2.1m). In line with expectations, H1
2025 delivered growth in profits compared to H1 2024, with further labour
supply growth, particularly on the HS2 project, driving profitability. In
addition, the growth in administrative expenses was controlled well, only
increasing by 6% to £5.2m (H1 2024: £4.9m).
Adjusted EPS increased by 19% to 2.11p per share (H1 2024 1.77p).
Cash was £9.8m as of 31 March 2025 (H1 2024: £1.7m).
Disposal of Suction Excavator subsidiary
In February, we successfully divested our Suction Excavator subsidiary,
delivering on the strategy set out by the Company in the announcement dated 6
January 2025. The subsidiary was sold to SNC Holdings (NW) Limited for a total
gross cash consideration of £2.3m. The divestment materially reduced the
Company's debt and lease liabilities by approximately £9m. The Suction
Excavator business accounted for 88% of Hercules' borrowings but less than 5%
of its revenue (as of 30 September 2024).
The Company expects free cash flow to increase following the disposal,
enabling the Company to dedicate greater resources to delivering its strategy
to capitalise on the high-growth opportunities available to Hercules' core
Labour Supply business. Cash generated from the disposal and associated debt
reduction will support the Company's ongoing acquisition strategy.
In FY 2024, the Suction Excavator subsidiary generated revenue of £6.0m and a
loss before tax of £0.4m (on a consolidated basis, the business had revenue
of £5.055m and an adjusted loss of £1.3m). As at 30 September 2024 the
subsidiary had a gross asset book value of £11.8m and net asset value of
£2.2m.
Labour Supply Growth
Labour supply remains the cornerstone of our business, and this division has
seen a 31% year-on-year increase in revenue. Growth continues to be driven by
the multi-year HS2 Phase 1 (Northern Section) contract, one of Europe's
largest infrastructure projects. At the time of publication, we have
approximately 630 operatives deployed on-site (31 May 2024: 550), with
weekly increases in line with rising demand. Our scalable digital platform is
central to supporting this growth efficiently.
We are seeing continued momentum in our rail division, launched in October
2023. We are engaging with additional Tier 1 clients as our presence in the
sector builds. Performance is in line with initial expectations, and we
anticipate further growth through FY 2025.
Looking ahead, we are laying the groundwork to support major long-term
infrastructure programmes. In anticipation of extensive works at Sizewell C,
we have established a regional office in Saxmundham, near Ipswich, to support
delivery. With this project expected to span up to 20 years, it represents a
significant long-term opportunity. We note the Government's recent acquisition
of the Wylfa nuclear site in North Wales, another strategic development likely
to offer future growth potential.
Construction Services
Civil Projects
There are well-documented issues within the water treatment sector within the
UK. Despite this, and as anticipated, the usual changeover from the AMP (Asset
Management Programme) 5-year plan (year 5 of AMP7 ended March 2025, AMP 8 now
started) has been slow and this has led to a reduction in civil projects
revenue of 31% in H1 2025.
Activity levels have remained good, but the size of project has reduced as the
current focus is on investigation and preparatory works. The industry's rush
to complete AMP7 increased workload significantly in FY 2024, contributing to
the size of the reduction in H1 now. However, given the AMP8 budget is
£104bn, a doubling from AMP7 (AMP7 was £51bn), a significant upturn in work
is expected from Easter 2026 and the team is busy helping clients with budget
pricing.
In April, we secured a place on the Wessex Water Civils Support Framework.
Hercules successfully tendered for a position on the new framework agreement
for additional civils resources, which will include both our Labour Supply and
Civil Projects divisions, to support Wessex Water with internal programme
delivery and capital maintenance activities. Wessex Water has identified a
need for investment of £3.65bn in 2025-30 which is more than double their
previous spend of £1.5bn.
Hercules Academy
We launched the Hercules Academy at the end of January 2024, and it has
trained over 1,500 people so far. The Academy, which is in Nuneaton in the
West Midlands, is close to the HS2 northern section sites. Nuneaton is
designated as a deprived area and we aim to attract clients, competitors,
further education colleges as well individuals who wish to join the
construction industry.
Given the skills shortage in the UK this is a long-term strategic project for
Hercules, to help us maintain our reputation with our blue-chip clients well
into the future.
The last six months have been the best period so far for the Academy as
delivery has ramped up across all types of training. The team has been working
hard delivering funded Skills Bootcamps with City & Guilds as well as
attracting new entrants into the industry with the help of Local Authority
funding.
The Academy has been well received by our clients and several discussions have
progressed in the period for future collaborations. It continues to expand its
training offer across the sector with clients and stakeholders to address
skills shortages throughout the UK.
In June, we acquired the business and assets of QTT. The acquisition will
increase the capacity of the Hercules Academy. QTT has a proven track record
of supporting unemployed individuals into work through fully funded training
programmes, often in partnership with local authorities, probation services,
and employers. QTT also has a contract to run a number of skills bootcamps
with the Department for Education, which will be transferred to Hercules.
QTT's employees will transfer to the Hercules Academy where they will help
expand significantly the number of courses available and broaden the
curriculum of the Academy. The addition of the QTT team and the integration of
QTT's assets means the Company will be able to scale its training operations
more quickly to support the UK's growing infrastructure project pipeline with
a skilled, job-ready workforce.
Interim Dividend
Reflecting our solid financial performance and commitment to shareholder
returns, the Board has declared an interim dividend of 0.6p per share (2024:
0.6p). The dividend will be paid on 22 August 2025 to shareholders on the
register as of 18 July 2025, with the shares going ex-dividend on 17 July
2025.
Outlook
The Company has maintained a strong momentum in H1 2025, winning and
delivering a growing volume of work. Given the market backdrop and our
operational platform, we are confident in delivering on our strategy in the
second half of the year. Our performance is typically weighted to H2, and we
are encouraged by the progress to date.
Key strategic initiatives, including the continued development of our
construction academy, the sustained expansion of our rail division, and
increasing commercial traction from our first acquisition, Future Build,
further supports our confidence in meeting full-year market expectations.
Henry Pitman
Non-executive Chairman
17 June 2025
Consolidated Statement of Comprehensive Income
6 Months Ended 31 March 2025
Unaudited Audited *Restated
Unaudited
6 months to Year ended 6 months to
31-Mar-25 30-Sep-24 31-Mar-24
£m £m £m
Continuing operations
Revenue 54.6 101.9 46.2
Cost of sales (46.8) (86.9) (39.2)
Gross profit 7.8 15.0 7.0
Recurring administrative expenses (5.2) (10.3) (4.9)
Adjusted EBITDA Subtotal 2.6 4.7 2.1
Depreciation (0.6) (1.0) (0.3)
Loss on sale of fixed assets - (0.2) (0.2)
Operating Profit 1.6 3.3 1.3
Finance costs (0.5) (1.1) (0.4)
Profit before tax 1.1 2.2 0.9
Taxation - (0.6) -
Net profit for the period 1.1 1.6 0.9
Discontinued operations
Loss for the period (1.2) (3.3) (0.7)
Total (loss)/profit for the period (0.1) (1.7) 0.2
Continuing operations
Adjusted net profit 1.7 2.2 1.1
Adjusted earnings per share 2.11p 3.47p 1.77p
*Restated for continuing operations
Consolidated Statement of Financial Position
31 March 2025
Unaudited Audited Unaudited
31-Mar-25 30-Sep-24 31-Mar-24
£m £m £m
Non-current assets
Tangible 7.9 7.4 21.1
Intangible 2.2 2.3 -
10.1 9.7 21.1
Current assets
Inventories - - 0.1
Trade and other receivables 22.1 19.5 17.3
Current tax recoverable - - 0.1
Cash and cash equivalents 9.8 6.4 1.7
Total current assets 31.9 25.9 19.2
Disposal group assets - 11.8 -
Total Assets 42.0 47.5 40.3
Equity and liabilities
Share capital 0.1 0.1 0.1
Share premium 12.8 10.7 5.2
Share based payment reserve 0.1 0.1 0.1
Retained earnings 0.3 0.8 3.0
Total equity 13.3 11.7 8.4
Non-current liabilities
Deferred tax liabilities 0.7 0.8 0.2
Deferred contingent consideration 1.0 1.0 -
Lease liabilities 0.7 1.3 11.7
Total non-current liabilities 2.4 3.1 11.9
Current liabilities
Trade and other payables 12.7 11.7 10.6
Borrowings 8.9 7.3 6.0
Lease liabilities 4.7 4.1 3.4
Total current liabilities 26.3 23.1 20.0
Disposal group liabilities - 9.6 -
Total liabilities 28.7 35.8 31.9
Total equity and liabilities 42.0 47.5 40.3
Consolidated Statement of Changes in equity
6 Months Ended 31 March 2025
Share capital Retained earnings Total equity
(Unaudited) (Unaudited) (Unaudited)
£m £m £m
At 1 October 2023 as previously stated 5.2 3.5 8.7
New share capital - - -
Share premium 0.2 - 0.2
Dividend paid - (0.7) (0.7)
Total comprehensive profit for the period - 0.2 0.2
Balance at 31 March 2024 5.4 3.0 8.4
Share capital Retained earnings Total equity
(Unaudited) (Unaudited) (Unaudited)
£m £m £m
At 1 October 2024 as previously stated 10.8 0.9 11.7
New share capital - - -
New share premium 2.1 - 2.1
Dividend paid (0.9) (0.9)
Total comprehensive profit for the period - 0.4 0.4
Balance at 31 March 2025 12.9 0.4 13.3
Consolidated Statement of Cash Flow
6 Months Ended 31 March 2025
Unaudited Audited Unaudited
6 months to Year ended 6 months to
31-Mar-25 30-Sep-24 31-Mar-24
£m £m £m
Cash flows from operating activities:
Profit/(loss) for the period (0.1) 1.6 0.2
Taxation charge - 0.6 -
Finance costs 0.5 1.1 0.8
Depreciation 0.6 1.1 0.8
Loss on disposal of property, plant & equipment 0.8 0.2 0.1
Decrease in trade and other receivables 0.1 1.4 5.3
Decrease/(increase) in payables (0.2) 1.5 (1.3)
(Increase) in inventories - - (0.1)
Net cash from continuing operations 1.7 7.5 5.8
Net cash generated from (used in) discontinued operations 0.6 (1.4) -
Net cash generated from operating activities 2.3 6.1 5.8
Cash flows from investing activities:
Purchase of property, plant and equipment (1.2) (0.3) (1.5)
Net proceeds on disposal of property, plant and equipment 1.9 0.1 0.5
Acquisition of subsidiaries - (1.2) -
Interest received 0.1 0.1 0.1
Net investing cashflows generated from/(used in) continuing operations 0.8 (1.3) -
Net investing cashflows used in discontinued operations (0.1) (0.1) -
Net cash generated from/{used in) investing activities 0.7 (1.4) (0.9)
Cash flows from financing activities:
Interest paid (0.8) (0.9) (0.8)
Dividends paid (0.9) (1.1) (0.7)
Payment of lease liabilities (0.1) (1.5) (1.8)
Net cash flows (to)/from invoice discounting facility
0.7 (2.7) (4.0)
Net proceeds from issues of shares 2.0 5.8 -
Net financing cashflows generated 0.9 (0.4) (7.3)
from/(used in) continuing operations
Net financing cashflows used in (0.8) (1.7) -
discontinued operations
Net cashflows generated from/(used in) financing activities 0.1 (2.1) (7.3)
Net increase/(decrease) in cash and equivalents 3.1 2.6 (2.4)
Cash and equivalents at start of the period 6.7 4.1 4.1
Cash and equivalents at end of the period 9.8 6.7 1.7
Cash and equivalents in discontinued operations - (0.3) -
Cash and equivalents in continuing operations at end of period 9.8 6.4 1.7
Notes
1. Notes to the Financial Information
Basis of preparation & accounting policies
The interim financial information for the six months ended 31 March 2025 is
unaudited and was approved by the Board of Directors on 16 June 2025.
The interim financial statements do not include all the information required
for full annual financial statements and should be read in conjunction with
the financial statements for the year ended 30 September 2024.
The interim financial information for the six months ended 31 March 2025,
including comparative financial information has been prepared on the basis of
the accounting policies set out in the last annual report and accounts.
The preparation of the interim financial statements requires management to
make judgements, estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets, liabilities, income
and expense. Actual results may subsequently differ from those estimates.
In preparing the interim financial statements, the significant judgements made
by management in applying the Company's accounting policies and key sources of
estimation uncertainty were the same, in all material respects, as those
applied to the financial statements for the year ended 30 September 2024.
Going Concern assumption
The Company meets its day to day working capital requirements through its cash
balance.
Consequently, after making enquires, the Directors have a reasonable
expectation that the Company has adequate resources to continue in operational
existence for the foreseeable future. Accordingly, they continue to adopt the
going concern basis of accounting in preparing the interim financial
statements.
Information extracted from the Company's 2024 Annual Report
The financial information for the year ending 30 September 2024, as set out in
this report, do not constitute statutory accounts but is derived from the
statutory accounts for that financial year.
The statutory accounts for the year ended 30 September 2024 were prepared
under IFRS and have been delivered to the Registrar of Companies. The auditors
reported on those accounts. Their report was unqualified, did not draw
attention to any matters by way of emphasis and did not include a statement
under Section 498(2) or 498(3) of the Companies Act 2006.
2. Earnings per share
The calculation of adjusted earnings per share is based upon the adjusted
profit after tax for the respective period. The weighted average number of
ordinary shares used in the calculation of basic earnings per share is based
upon the number of ordinary shares in issue in each respective period.
3. Significant Capital Purchases
None within this period.
4. Share capital
79,619,628 ordinary shares were in issue as of 31 March 2025 (31 March 2024:
63,422,415)
5. Availability of interim results
The interim results will not be sent to shareholders but will be available at
the Company's registered office at Hercules Court, Lakeside Business Park,
Broadway Lane, South Cerney, Cirencester GL7 5XZ and on the Company's website:
www.herculesplc.com (http://www.hercules-construction.co.uk)
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END IR KZGMVLVZGKZMRecent news on Hercules
See all newsREG - Hercules PLC - Acquisition of Advantage NRG Ltd
AnnouncementREG - Hercules PLC - Interim Results
AnnouncementREG - Hercules PLC - Acquisition of Quality Transport Training
AnnouncementREG - Hercules PLC - Notice of Results & Investor Presentation
AnnouncementREG - Hercules Site Svcs - Change of Name
Announcement