Steel firm’s profits could be hit by overruns

SEVERFIELD-Rowen today warned that full year profits could be hit because of “operational overruns” of £1.6m on two UK projects.

The North Yorkshire-based structural steel firm, which owns Bolton-based Watson Steel, said pre-tax profits over the first half of its financial year are expected to be around £1.5m.

In a trading update this morning, Severfield-Rowen said: “Further to the interim management statement on May 18, which indicated that results for the full-year would see a greater weighting towards the second half of the year, we now expect that weighting to be more pronounced as a result of anticipated operational overruns of £1.6m against our estimated costs on two complex projects in the UK.”

The group admitted that although it still expects to post year on year profit growth, profit for its present financial year could be lower than expectations.

However, Severfield-Rowen said it had a strong order book and a “good project mix” in both the UK and India.

The group will announce its half-year results on 21 August 2012.