Investment Group PHD ready for difficult year ahead
Daresbury-based investor, PHD Industrial Holdings, said it has enjoyed a “strong performance and strategic growth” amid economic challenges during the year to September 30, 2024, which saw a fall in pre-tax profits on stable revenues.
Turnover for the group stood at £64.565m, compared with £63.160m.
Pre-tax profits tumbled from £3.150m in 2023 to £269,000, but in the annual report chairman James Dow highlighted its “pre-exceptional EBITDA” of £4.95 million which also dropped from £6.28 million the previous year.
By the end of the financial year, the group had cash worth £9.8m.
The group incurred exceptional costs of £1.606m, up from £112,000 the previous year, mainly due to impairment of goodwill at its OFP Group.
During the year PHD added 50 sales, administration and management staff, taking its total headcount to 342.
At the Rainmakers conference on 26 March PHD presented their alternative to private equity and a trade sale model.
PHD is a corporate holding company that invests in smaller SMEs across traditional market sectors, aiming to grow through acquisitions and organic development. Established in 2021, it currently comprises five main trading businesses.
While new platform acquisitions remained limited, PHD completed several strategic bolt-on acquisitions. Notably, Technikraft and BIL Group expanded PHD’s capabilities in the speciality chemicals and materials handling sectors, respectively.
Looking ahead, PHD said it remains committed to increasing capital value through prudent investment.
With a strong balance sheet and significant cash reserves, the company said it is well positioned to navigate the UK’s economic challenges and capitalise on attractive acquisition opportunities.
Its focus remains on strategic bolt-on acquisitions within existing platform businesses, as well as pursuing new platform opportunities.
PHD’s strategic focus is particularly strong in the speciality chemicals sector, where the group now boasts three businesses: Hylomar, Tecknikraft, and Delta Fluid Technology (Delta).
With a growing pipeline and increasing interest from businesses within the sector, PHD is actively pursuing further acquisitions.
It has seen a noticeable rise in inbound acquisition interest over the last six to 12 months, particularly as business owners, many of whom are nearing retirement, look for a partner to ensure the longevity and legacy of their companies.
Andy Dodd, PHD Industrial Holdings director, said: “Our strong performance this year reflects the resilience of our businesses and the strength of our investment strategy, despite a challenging economic backdrop.
“By focusing on strategic acquisitions and long term value creation, we have continued to grow and strengthen our portfolio.”
Chairman, James Dow, said: “The continued subdued global economy, the prospects of National Insurance rises in April and the recent trading experience of our portfolio companies suggests that this year is set again to be very difficult.”
