Redhall on top of its game
A BETTER recognised brand and growth in the energy and defence sectors has helped boost Redhall’s profits by 63%.
The Wakefield-based specialist engineering support services group said that profit before tax for the six months ended March 31 rose to £3.1m compared to £1.9m in the same period the year before.
Revenue increased by 56% to £64.8m from £41.5m in the first half of 2008. Its strong performance is backed by a healthy order book, which currently stands at £110m.
The board has recommended an interim dividend of 1.65p per share – a 10% increase on the 1.5p interim dividend in 2008 and in line with the continuation of its stated policy of a minimum of three times cover.
David Jackson, chairman and chief executive of Redhall, said: “Redhall has continued to build upon the foundations that have been put in place and produced strong organic growth, despite the challenging markets caused by the economic downturn.
“We believe we have built a stable and robust business which is well positioned to see increased benefits when conditions begin to improve.”
He said that the firm had a “loyal core” of customers both in the private and public sector. He added that the range of sectors that the firm operates in and the breadth of their requirements meant that Redhall was able to weather the current economic climate.
Energy, which includes activities in civil nuclear, oil and gas and power, now represents 47% of group revenue at £30.2m – a like-for-like increase of 35%.
Despite the introduction of a new parent body organisation at Sellafield, Redhall is continuing to secure major contracts at the nuclear power station.
It has also expanded its geographic and client footprint to include Trawsfynydd, Berkeley, Bradwell and Hunterston and Hartlepool.
The group’s oil and gas activities continue to remain “very strong” and with the exception of the cancellation of its Sea Dragon contract earlier in the year revenue streams remain buoyant.
Redhall also plans to further its activities in power through Chieftain, which it acquired in October, 2008.
The subsidiary has recently taken its first steps into alternative power by securing contracts for the mechanical installation of equipment at a waste to energy plant for Lancashire County Council and Blackpool Council.
Revenue for the group’s defence arm is being boosted by work carried out for BAE at Barrow and AWE Aldermastion.
However, the firm is having to be more selective over key bidding decisions in the chemical sector as wider reduction in consumer demand is causing increased competition from national and local players.
“We have remained selective regarding key bidding decisions and we have prioritised our major clients whom we believe will benefit from the upswing in the economy in the future,” it said.
