REG - Hill & Smith PLC - Trading Update

Hill & SmithAnnouncement

16/11/2022 07:00

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RNS Number : 5247G  Hill & Smith PLC  16 November 2022

16 November 2022

 

Hill & Smith PLC

Trading Update

 

Robust trading - full year outlook expected to be ahead of expectations

 

Hill & Smith PLC ("Hill & Smith" or "the Group"), the international
group creating sustainable infrastructure and safe transport through
innovation, provides a trading update for the four-month period to 31 October
2022 ("the period").

 

Group Performance and Outlook

Trading in the period has remained robust with revenue from continuing
operations 18% ahead of the prior period on an organic constant currency
basis. Our operating companies continue to take pricing actions to offset cost
input inflation and we are pleased to report that operating margins were ahead
of H1 2022 and the same period last year.

Based on the good trading performance to date and a foreign exchange tailwind,
we now expect full year operating profit from continuing operations to be
ahead of the top end of current analyst consensus^.  The Group expects to see
a material improvement in cash generation during H2 2022.

While mindful of current macroeconomic uncertainty, the Group has a proven
track record of resilience and, with exposure to the structural growth markets
of sustainable infrastructure and safe transport, is well positioned to
deliver against its strategic goals. Consequently, we expect to make further
progress in 2023.

Trading by division

The Galvanizing division continued to perform strongly, supported by pricing
actions and good volume growth in the US. The integration of Widnes
Galvanising is going well and enhances the Group's presence in the north west
of the UK.

The Engineered Solutions division delivered strong revenue and profit growth
in the period with buoyant levels of demand across the portfolio. In
particular, our faster growing US businesses continue to perform well.

Our Roads & Security division delivered good revenue and profit growth in
the period. In the UK, further delays to strategic road upgrade projects
resulted in lower temporary safety barrier utilisation than expected, however
this was more than offset by strong demand for the UK security portfolio.
 Prolectric, our UK off grid lighting and power solutions business, continued
to deliver good growth in the period and the recent acquisition of National
Signal, based in California, further accelerates our strategy in this fast
growing and attractive market.

Update on Refinancing

We are pleased to report that we have successfully completed the refinancing
of our principal bank debt facility on competitive terms(*).  The new
syndicated revolving credit facility of £250m has an initial maturity of four
years with an option to extend for a further year at the first anniversary,
providing us with certainty of funding to support the Group's growth
opportunities.

Financial Calendar

The Group's preliminary results for the year ending 31 December 2022 are
scheduled to be announced on 8 March 2023.

 

 

^ The current company compiled analyst expectation range for FY22 underlying
operating profit is £84.9m to £89.7m on a continuing operations basis.

* As we noted previously, Group interest costs for the year will include an
additional c£2m of refinancing charges under IFRS 9.

 

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 profit forecast nor should it be taken to mean that
earnings per share of Hill & Smith in the year ending 31 December 2022, or
in future years, will necessarily match or exceed the Group's historical
earnings per share

 

 

For further information, please contact:

Hill & Smith PLC
               Tel:  +44 (0)121 704 7434

Alan Giddins, Executive
Chair
 

Hannah Nichols, Chief Financial Officer

MHP Communications                          Tel:  +44
(0)20 3128 8613

Rachel Farrington

Catherine Chapman

 
 

 

Notes to Editors

Hill & Smith PLC creates sustainable infrastructure and safe transport
through innovation. The Group employs c.3,800 people worldwide with the
majority employed by its autonomous, agile, customer focussed operating
businesses based in the UK, USA, Australia, India and Sweden. The Group office
is in the UK and it is quoted on the London Stock Exchange (LSE: HILS.L).

 

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

 

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

Engineered Solutions: supplying engineered steel and composite solutions with
low embodied energy for a wide range of infrastructure markets including
energy 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,
renewable energy lighting and power solutions, Intelligent Traffic Solutions,
street lighting columns and bridge parapets. The security portfolio includes
hostile vehicle mitigation solutions, high security fencing and automated gate
solutions.

 

 

 

 

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