9th Sep 2014 08:59
LONDON (Alliance News) - Billington Holdings PLC said Tuesday that it expects its full-year results to come in ahead of current expectations, encouraged by rises in first-half pretax profit and revenue, and said it will consider a full-year dividend after benefiting from improving conditions in its structural sector.
Shares in the Billington surged in early trading, making the company the second biggest gainer on the London market, trading 22.17% higher at 183.25 pence per share.
In the six months to June 30, the structural steel and construction safety technology company said pretax profit more than tripled to GBP759,000 million from GBP252,000 million the previous year as revenue jumped 35% on the comparable half to GBP23.2 million from GBP17.2 million.
Profit was boosted further by lower operating charges, staff costs and redundancies, said Billington.
The company, which is backed by Henderson Global Investors among other investors, declared no interim dividend but said the board will consider a dividend declaration upon announcement of its full-year results, expected March 2015. Billington has not paid out a dividend since 2010.
"The board has previously indicated its intention to recommence the payment of a dividend at the appropriate time. With optimism within the wider UK economy continuing to improve and in view of the anticipated result for the full year, the board has decided that it is appropriate to give an indication at this stage that it intends to give serious consideration to the declaration of a dividend when the full year results are announced in March 2015," the company said.
The final decision on whether to payout a dividend will depend on the anticipated cash requirements of the business as activity levels increase and capital expenditure plans on replacement of plant and equipment.
Capital expenditure during the half-year rose to GBP500,000 from GBP100,000 as the company extended the hire fleet of Billington's hoarding product, it said.
The group's cash balance as of June 30 stood at GBP2.8 million, compared to GBP417,000 last year. Billington said this provides it with an adequate cash resource and funding facility to enable it to take advantage of the "apparent, albeit slow, economic recovery."
Billington Holdings said its strong half-year came on the back of its internal "stability and return to profitability" programme, as well as improving market conditions. "The first half of 2014 has seen real signs of improvement in the structural sector and we anticipate that our specialist divisions will demonstrate corresponding improvements in the second half. It is expected that the result for the full year will be ahead of the current forecast," said Chief Executive Steve Fareham.
On a divisional basis, the company said the Structural Steel business delivered projects into a broad range of market sectors during the first-half and it remains optimistic that projects will be secured in the second-half of 2014, with several potential projects with its joint venture, Bourne Construction, BS2, currently in the pipeline, though noted that recent improvements in the sector have yet to filter through to its Leeds-based Peter Marshall Steel Stairs division.
The Safety Solutions division began 2014 at a slower pace, said Billington, following the trading pattern of the previous financial year, but due to the improvements seen in the structural steel market, "our utilisation has grown steadily in the second quarter and forecasts for the third and fourth quarters look strong. We have seen further improvements in our work within the timber frame sector and when dealing directly with main contractors," said the company.
Looking ahead the company remains confident that it will make further progress, with full-year results anticipated to be ahead of current expectations, and believes that the group will benefit from improving market conditions.
By Alice Attwood; [email protected]; @AliceAtAlliance; Additional reporting by Rowena Harris-Doughty
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
Billington