Superstorm Sandy boost for Hill & Smith but London plant to close
SAFETY barrier manufacturer Hill & Smith has had a mixed start to the year.
In the US it is busy on work linked to the destruction caused by Superstorm Sandy – including supplying protective materials to the Statue of Liberty – but the firm’s plant in East London is likely to close.
The firm is looking for a pick-up in business during the rest of 2013 following a relatively sluggish start to the year.
In an interim management statement ahead of today’s AGM, the Shirley, Solihull, firm said performance has been in line with its outlook given at the time of its preliminary results on March 12.
“Trading across the group started slowly, as expected, with variable levels of order intake and delivery of smaller projects in comparison to the prior year,” it said.
“Whilst our expectations for the full year outcome remain unchanged there will be a greater weighting to the second half than usual, and whilst there is good evidence of larger projects now being scheduled for delivery in the second half, we retain a degree of caution as to the overall outlook for some of our end markets.”
In the roads area Hill & Smith said it is benefitting from increased use of its temporary vehicle restraint system, Varioguard. Currently there are five managed motorway schemes under construction, the largest of which is the M25, where the firm has 60km of Varioguard in use.
Approval for Zoneguard in Australia has recently been granted and an agreement has been signed with a long-term partner for supply to the Australian market. The first shipment is scheduled to take place in the second half of 2013.
The firm said its US- based transmission structures and substation business performed well due to the continuing demand for upgrades and the connection of renewable projects to the US power grid.
“The additional power generated from renewables has however, delayed decisions to build new power plants in the USA. Accordingly, our US pipe supports business has had a slow start to the year but we expect more enquiries for gas-fired power stations later in the year,” the firm said.
“Outside of the USA, we entered 2013 with a strong order book buoyed by emerging market power demand. However, capacity limitations in Thailand forced some larger projects to be manufactured in the UK facility, thus increasing costs and depressing margin.
“Our new Indian facility has been accredited with ISO9001, which will allow for the supply of future projects in India at a lower cost base.
“Creative Pultrusions, our USA based composites company, whilst lacking the large one-off ballistic panel order it enjoyed in the first quarter of 2012, has secured large orders for the supply of piling for costal protection to the Statue of Liberty, New York and the boardwalk at Long Beach, New Jersey, which are part of the rebuilding taking place in the aftermath of Superstorm Sandy.
“In the UK, both our industrial flooring and our building products businesses are performing ahead of last year.”
In the galvanizing services area, overall production volumes were 4% lower than the same period last year. UK volumes were flat year on year and the USA, although down 5% compared to last year, achieved increased profitability through a better product mix and continued focus on operational efficiencies.
The firm’s new galvanizing facility in Columbus, Ohio is now fully operational and the efficiencies and additional capacity from the modern plant are beginning to be realised.
In April the firm acquired the UK based Medway Galvanizing Company Limited which operates a large plant in Kent, for £6.6m.
Hill & Smith is currently in consultation regarding the proposed closure of its plant located in East London, near the Olympic site.
