REG - Hill & Smith PLC - Trading Statement

Hill & SmithAnnouncement

20/11/2024 07:00

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RNS Number : 8580M  Hill & Smith PLC  20 November 2024

20 November 2024

Hill & Smith PLC

Four month trading update

Full year expectations unchanged

Hill & Smith PLC ("Hill & Smith" or "the Group"), the international
provider of sustainable infrastructure products and services, provides a
trading update for the four-month period to 31 October 2024 ("the period").

 

Trading Performance and Outlook

Trading in the period has been positive, reflecting good momentum in our
Engineered Solutions and Galvanizing Services divisions, particularly in the
US.  Revenue for the period was up 7.5% on a constant currency basis and 2%
on an organic basis, an improvement on the first half growth rates. Group
operating margin was ahead of the same period last year and cash conversion
continues to be strong.

We expect FY24 operating profit to be in line with current analyst
consensus(†*).

Trading by Division
The Engineered Solutions division delivered a robust performance, supported by strong demand across a range of US infrastructure markets.  During the period, the Group acquired Whitlow, a manufacturer of structural steel substation components for the US electrical infrastructure market, and Trident Industries, a US based designer and supplier of composite utility poles.  The integration of both businesses is progressing well, and initial trading is encouraging.
 
Galvanizing Services delivered good revenue and profit growth in the period, reflecting 13% volume growth in our higher margin US business and a resilient performance in the UK with volumes 7% higher than the same period last year.
 
Revenue and profit in the Roads & Security division were lower than the same period last year, partly reflecting the challenging UK market backdrop. In addition, the subdued performance in our US off-grid solar lighting business that we observed in H1 has continued, with softer demand levels from its largest customer.

 

Rutger Helbing, Chief Executive, commented:

 

"I have spent my first two months at Hill & Smith understanding the
business, reviewing the strategy, visiting our operating companies and meeting
our talented teams. This has reinforced my view that the Group is exposed to
attractive infrastructure end markets with structural growth drivers and
therefore has excellent prospects for further value creation for our
shareholders.  I will share my initial observations on the Group when we
publish our preliminary results in March 2025.

 

The positive trading performance during the period reflects the strong
momentum in demand for our products and services, particularly in the US, and
the benefits of our focused M&A strategy"

 

Financial Calendar

The Group's preliminary results for the year ending 31 December 2024 are
scheduled to be announced on 12 March 2025.

 

(†)The current company compiled analyst consensus expectation for FY24 is for underlying operating profit of £139.1m, with a range of £135.9m-£145.1m.

(*)The current company forecast for FY24 assumes an average exchange rate of
1.28 US Dollar to 1 UK Pound, noting the previous guidance issued in August
2024 assumed an exchange rate of 1.27 US Dollar to 1 UK Pound.  A one cent
movement in the average US Dollar rate currently results in an adjustment of
approximately £4.0m to the Group's annual revenues and £1.0m to annual
underlying operating profit.

 

 

For further information, please contact:

Hill & Smith PLC

Rutger Helbing, Chief Executive
Officer
Tel:  +44 (0)121 704 7434

Hannah Nichols, Chief Financial Officer

 

MHP

Reg Hoare/Rachel Farrington/Hugo
Harris
Tel:  +44 (0)7801 894577

 
 
       hillandsmith@mhpgroup.com

 

Notes to Editors

Hill & Smith PLC is a leading provider of sustainable infrastructure
products and services. The Group employs c.4,250 people worldwide with the
majority employed by its autonomous, agile, customer focussed operating
businesses based in the US, UK, Australia and India.  The Group head office
is in the UK and Hill & Smith PLC is quoted on the London Stock Exchange
(LSE: HILS.L).

 

The Group's operating businesses are organised into three main business
divisions:

 

Galvanizing Services: increasing the sustainability and maintenance free life
of steel products including structural steel work, lighting, bridges and other
products for industrial and infrastructure markets.

Engineered Solutions: supplying engineered steel and composite solutions for a
wide range of infrastructure markets including power generation and
distribution, marine, rail and housing.  The division also supplies
engineered pipe supports for the water, power and liquid natural gas markets
and seismic protection solutions.

Roads & Security: supplying products and services to support road and
highway infrastructure including temporary and permanent road safety barriers,
intelligent traffic solutions, street lighting columns and bridge parapets.
In addition, the division includes two businesses which are market leaders in
the provision of off-grid solar lighting and power solutions.  The security
portfolio includes hostile vehicle mitigation solutions, high security fencing
and automated gate solutions.

 

 

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