25th Jul 2018 10:38
LONDON (Alliance News) - Van Elle Holdings PLC on Wednesday said profit dropped slightly in its recently ended financial year while revenue jumped on a strong performance in the housing and infrastructure sectors.
The construction engineering company reported a pretax profit of GBP9.2 million for the year to the end of April, down 1.2% from GBP9.3 million reported a year earlier, despite revenue rising by 10% to GBP103.9 million from GBP94.1 million.
During the year, the company incurred exceptional items of GBP283,000 from legal and other professional costs associated with the emergency general meeting held in December last year and an aborted acquisition.
In December, former Chairman Michael Ellis had tried to return alongside other directors, replacing existing management, but this was rejected by shareholders.
The revenue growth was driven by activity in new housing and infrastructure sectors, Van Elle said. Housebuilding revenue was up 22% year-on-year at GBP51.9 million compared to GBP42.5 million and infrastructure sector revenue grew by 12% to GBP32.3 million from GBP28.9 million.
The General Piling unit posted "modest" sales growth in the year, up 0.5% to GBP43.1 million compared to GBP42.9 million, as a result of good demand in the housebuilding sector offset by reduced demand for industrial and commercial work.
Meanwhile, sales were marginally lower in the Specialist Piling division at GBP29.9 million versus GBP30.1 million reported a year earlier. The rail business within the unit was significantly impacted by the collapse of construction company Carillion PLC, leading to a GBP956,000 debt write off.
Outside of work with Carillion, the rail business had a relatively successful second half, Van Elle said, including the commencement of a track bed stabilisation contract.
The company had a "particularly" strong revenue performance in the Ground Engineering Services unit, which was up 65% to GBP17.5 million, driven by Van Elle's investment in the Scottish market.
Van Elle has declared a final dividend of 2.30 pence per share, taking the total payout for the year to 3.70p, up from 2.60p paid the year before.
Van Elle also confirmed Wednesday its new chief executive Mark Cutler, whose appointment was announced in early May, will join in August. Former boss Jon Fenton left in May after a "serious medical matter" within his family.
"Following the challenging conditions experienced at the start of 2018, recovery has been slow in a number of our end markets which has resulted in a relatively quiet first quarter for the group as a whole," said Chairman Adrian Barden.
"However, we are seeing an increase in opportunities across each of our divisions, particularly in the housebuilding and infrastructure markets," Barden continued. "In the near term the board is focussed on refining the group's commercial approach, continuing to enhance its processes and operations and maximising the returns from the substantial investment in the rig fleet."
Shares in Van Elle were trading 1.8% lower on Wednesday at 80.55 pence each.
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