11th Aug 2015 07:03
LONDON (Alliance News) - Hargreaves Services PLC on Tuesday said its pretax profit and revenue both dropped heavily in the financial year to the end of May as the group completed its restructuring, but said it would hike its dividend by 18% in line with its new payout policy.
Hargreaves, which supplies solid fuel and bulk material logistics services, said its pretax profit from its continuing operations in the year to the end of May was GBP24.9 million, down slightly over half from the GBP52.1 million it made a year earlier. The profit was pulled down by the lower amount the group had to accept for the Liverpool Biomass Conversion project, one of a number of projects the group exited over the course of the financial year as it restructured its operations.
Revenue fell by 24% to GBP662.2 million from GBP869.2 million, but Hargreaves said its underlying trading was in line with its expectations, as it works to complete its "simplification" process, which is focused on cutting costs amid challenging conditions, particularly in the coal market.
Hargreaves said the coal price has fallen further since its interim results, with a number of potential coal-fired power station closures announced, further hitting the conditions it is contending with.
But the group increased its full-year dividend by 18% to 30.0 pence per share, including an increased final dividend of 20.0 pence, up from from 16.7 pence a year before, based on its move to a higher dividend payout ratio and its strong cash generation.
"The last two years have presented the coal industry with extremely challenging market conditions. The board has worked hard to ensure controllable risks are managed and to minimise the impact of risks beyond our control. We were clearly right to initiate the simplification programme last year. With a significant restructuring exercise largely behind us, we can concentrate on our strategic options to deliver future shareholder value," said Chairman Tim Ross.
By Sam Unsted; [email protected]; @SamUAtAlliance
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
Hargreaves Serv