Watson Steel owner shows its strength

THE construction sector may be hurting thanks to the recession but structural steel manufacturer Severfield-Rowen is headed for bumper profits.

The listed company which owns North West-based Watson Steel Structures, will tell shareholders at its annual general meeting today that profits for the current year will be ahead of management expectations following strong trading in the first five months.

The order book stands at £267m and is set to grow as a result of export sales.

However, Severfield said that while its position was “most welcome” in the current economic environment, it should be tempered by the fact that prospects for the UK continue to fade to levels below those forecast by the industry in recent months.

“We are now experiencing a significant decline in demand in the company’s key UK construction sectors and as a result we will implement further cost reductions and reconfigure capacity,” it said in a statement.

“We have good visibility for the current year and remain confident of a strong financial performance for the rest of 2009, but are cautious in our outlook for 2010.

Watson, based at Lostock near Bolton, specialises in the steel work for sports stadia, airports and bridges.

Last year it won the contract to build the showpiece 2012 London Olympics stadium.

It previously worked on the Bolton Reebok stadium, the City of Manchester stadium and Arsenal’s Emirates ground. It employs around 265 people.