Revenues up as engineering group forecasts strong year
ENGINEERING group Hill & Smith said it believes its performance will be “at the top end of market expectations” after a strong start to its financial year.
The Shirley-based business will also benefit from the positive impact on its overseas earnings from the recent weakness in Sterling.
A trading update for the four months to the end of October showed underlying revenue increased by 15% to £185.0m.
Derek Muir, Hill & Smith’s group chief executive, said: “Overall, conditions in many of our infrastructure end markets remain favourable and we continue to expect the group to report good progress for 2016.”
It was on the acquisition trail in the summer with three eight-figure acquisitions in as many months. The group paid £12.5m to acquire Oldbury-based Signature, a former subsidiary of Plastic Omnium. It also paid £10m for Technocover and £11m for Nottingham-based Hardstaff Barriers,.
Analysts N+1 Singer said it remains “strong supporters” of the group following another positive update.
It said: “Another positive update from HILS with most of the Group performing well. We said in September that potential infrastructure stimulus in the UK and the US would be positive for sentiment and as it becomes more likely this is indeed the case.
“Whilst that may take a while to affect numbers, underlying trading is strong enough to justify confidence in the forecast period anyway. With the ongoing potential for accretive acquisitions on top, we remain strong supporters at this level and remain at Buy.”
