Challenging first half for engineering group
Turnaround activity at Cumbrian engineering group James Fisher continues as the company reported a 2% increase in half year revenues.
Revenues for the half-year to 30 June 2022 rose to £238.4m, up from £233.7m for the same period in the prior year.
However, underlying pre-tax profits has dropped 47.8% to £4.8m, down from last year’s £9.2m.
The group said turnaround was continuing with restructuring activities expected to deliver around £3m in annualised savings.
Chairman Angus Cockburn said: “The first half saw an increase in Group revenue but a decrease in profit, due to portfolio mix.
“Offshore Oil and Tankships produced strong revenue growth and improved profitability and Marine Contracting continued its turnaround.
“However, Fendercare’s markets remained subdued and the cyclical nature of project work in Specialist Technical was reflected in its performance.
“The Board and management team are taking decisive actions to address the ongoing issues affecting the Group’s performance, including rolling out an operational excellence programme across the Group; continuing to explore ways to rationalise the portfolio; and restructuring the Fendercare and JFD businesses. More strategic actions will be completed in the second half.
“Trading and order intake in the busy summer months of July and August were in line with expectations.
“H2 is anticipated to be materially stronger than H1. We expect to see continued strong demand within the Offshore Oil and Tankships divisions throughout the rest of the year. Order book coverage in Marine Contracting is good.
“Whilst Specialist Technical’s sales pipeline remains strong, the timing of new, significant, long-term project wins is uncertain. As a result, full year underlying operating profit is now expected to be broadly in line with 2021.”
He added: “The seasonality of working capital and collection of one JFD project milestone are expected to deliver a reduction in net debt by the end of the year. The debt position could be further improved by our ongoing portfolio rationalisation activities, which aim to reduce net debt and simplify and focus the Group.
“Although the ongoing geopolitical and economic climate is likely to remain uncertain, the Board is confident that it is taking the right steps to stabilise the business and create a platform for sustained recovery.”
