In recent months the availability of funding and cost concerns have led to potential contract orders getting delayed, Severfield said.
It said that although it still has 鈥榓 strong pipeline of opportunities鈥� it has seen 鈥榓 number of larger projects鈥� that it has bid for in the last six months suffer material delays. One was cancelled altogether. Among the delayed projects are three strong prospects that together would be worth more than 拢100m to the company.
Despite all this, interim results for the six month period ended 30th September 2015 showed revenue up 20% to 拢117.1m (2014 H1: 拢97.4m) and pre-tax profit of 拢2.6m, which is nearly double the 拢1.4m made in the same period last year. Underlying profit before tax was 拢4.8m (2014 H1: 拢3.0m).
Chief executive Ian Lawson said it was 'another six months of good progress' with improved margins 鈥� underlying operating margins were up from 3.7% last time to 4.3%.
He said: 鈥淲e remain very active in our chosen sub-sectors of focus, specifically construction and infrastructure and our order book remains solid at 拢185m and the pipeline healthy. The order book comprises a good balance of small and medium-sized projects, and could have been even greater had some of our larger prospects not been subject to material delays in mandates being awarded.鈥�
On 16th November, Severfield completed its investment in a 50% share of metal decking manufacturer CMF Ltd. CMF is an existing Severfield supplier but following this investment, all of Severfield鈥檚 metal decking requirements will come from CMF. The initial consideration for the investment is 拢4.0m and a further 拢2.5m is payable over the next five years subject to certain conditions.
鈥淭his investment is another step in the implementation of the group's strategy and will strengthen the group's supply chain as well enabling it to extract greater value from its existing activities,鈥� Mr Lawson said.
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