Profits dip at Watson Steel parent

SEVERFIELD-Rowen, the structural steel group, today said it was in a position to extend its production capacity in India but warned that UK market conditions remain “lacklustre”.

The Yorkshire group, which has one of its main operations, Watson Steel, in Lostock near Bolton, saw underlying group profit before tax reduce from £15.3m in 2010 to £10.1m last year.

For the year ended December 31, revenues remained steady at £267.8m. The group made an underlying operating profit of £11.7m compared to £16.2m in 2010.

Severfield-Rowen, which worked on projects in 2011 including the new Leeds Arena, Heathrow Airport and The Shard in London, is recommending a final dividend of 3.50p, giving 5p for the full year.

Chief executive Tom Haughey said: “The group is pleased to present a sound set of results, in-line with overall market expectations, underpinned by a strong UK performance, while operations in India continue to improve.

“The group has entered 2012 well placed to face the on-going challenges of a subdued domestic market with limited growth prospects.
“UK performance measured against our peers was again highly creditable, displaying the group’s financial, commercial and service strengths and its market leading position.

“The UK economy remains lacklustre and the duration of the downturn is having a significant impact upon the durability of our industry competitors, several of whom exited the sector in 2011.”

Severfield-Rowen said its post Olympic Games order book was £221m.