Hill & Smith predicts good year for the business after rise in H1 profits

SOLIHULL-based building products supplier Hill & Smith has said it expects 2014 to be a good year for the business after it reported a big rise in half-year profits.

Underlying pre-tax profit at £20.8m was 12% higher than the previous year (2013: £18.5m). Pre-tax profit rose to 2% to £16m (2013: £15.7m). This was despite just a 1% increase in revenue to £223.8m (2013: £221.6m).

Underlying earnings per share were 20.3p, up 15% compared to the previous year (2013: 17.7p). Basic earnings per share was 14.6p (2013: 15.0p).

The board has declared an interim dividend of 6.4p per share (2013: 6.0p), representing a 7% increase on the corresponding period last year.

The group said it had benefitted from the industrial and geographical spread of its markets and businesses, which created a resilient base with opportunities for growth. However, it did of tough H2 comparables due to a strong second six months last year.

“Conditions in many of our end markets are generally encouraging and therefore provide a solid platform for the remainder of 2014 and beyond. Implementation of strategic initiatives to improve returns from the group’s portfolio and increased capital expenditure for organic growth provide momentum to our drive for increased shareholder value,” it said.

“We do however, remain mindful of the high level of comparatives from our record second half underlying earnings per share performance in 2013, the continued weakness of the French economy and the strengthening foreign exchange headwinds currently being experienced.

“Overall, our performance to date has been in line with expectations and with a continued marginal bias to the second half we expect 2014 to be a year of good progress for the group.”