Van Elle issues profit warning and reviews overseas options
Van Elle, the Nottinghamshire groundworks company, has issued a profit warning this morning (March 13), blaming a “supressed” market and project delays.
The business said it has experienced “widespread” delays – blaming the pause to the Building Safety Act approvals which has impacted trading for its Rock & Alluvium company, which is focused on taller residential schemes in London and the south-east.
A statement from Van Elle said: “There are over 40 projects currently in the approvals process, the majority of which are now expected to commence in FY26 and will result in a FY25 performance for Van Elle’s UK operations slightly below the board’s expectations.”
Meanwhile, Van Elle says it is considering pulling out of Canada after experiencing further delays to its works on the uprgrade of the Toronto rail network.
Van Elle added: “As a consequence of these delays, the division’s trading performance will now be weaker than initially anticipated. Van Elle has developed a solid track record locally in Canada and has secured several key frameworks throughout FY24 and FY25 which have created several attractive medium-term opportunities. With the near-term uncertainty around the timing of key investment programmes, the board is reviewing its strategic options with respect to its operations in Canada.
“Consequently, as a result of the aggregate impact of the Rock & Alluvium and Canada trading performance, the board now expects underlying profit before tax for the second half of FY25 to be similar to the first half.”
Van Elle’s struggles means the firm now has an “acute focus on careful working capital management” and “aligning its cost base to drive operating efficiencies”. The company has disposed of certain non-core assets in support of a robust balance sheet and its objective of improving return on capital employed.
Better news comes in the form of several large projects have recently been secured in Van Elle’s General Piling division, which will be delivered in early FY26.
The company added: “In addition, scheduled workloads across March and April represent an increase in volumes, providing encouraging momentum into the new financial year.
“With an expectation that the housing market will progressively improve throughout calendar year 2025, further progress in the energy and water markets, combined with the Government’s commitment to accelerate infrastructure spend and address the backlog of Building Safety Act approvals, the board remains optimistic for the group’s prospects for FY26 whilst recognising that the pace of market recovery may be slower than previously expected.”
