Steelwork contractor says slump in profit down to impact of first lockdown
Turnover at the steelwork firm helping build new stands at Lord鈥檚 cricket ground and Fulham鈥檚 Craven Cottage stadium hit a 10 year high last year with Severfield reporting an income of more than 拢360m.
The firm said the number jumped 11% to 拢363.3m in the year to March as the firm bucked the trend of contractors seeing revenue ravaged by the pandemic.
But the country鈥檚 biggest steelwork contractor wasn鈥檛 immune from the impact of covid on its bottom line with pre-tax profit slipping 18% to just over 拢21m.
The firm, which said it has appointed Rosie Toogood, the chief executive of L&G鈥檚 modular homes business, as a non-executive director, added this was largely down to the impact of the first lockdown in March last year as sites and factories were temporarily closed while new working conditions were brought in.
Severfield said it furloughed some of its 1,500 staff in the first half of its financial year but did not claim for support from the government鈥檚 Coronavirus Job Retention Scheme.
It said it had deferred VAT, PAYE and other tax payments during the year but these had all been repaid by the year end.
The firm, whose ongoing 100-plus projects include work on Lendlease鈥檚 new Google headquarters building at King鈥檚 Cross as well as Multiplex鈥檚 Bankside Yards mixed-use scheme at Blackfriars, said the impact of steel price rises would impact its working capital in the short term.
It added: 鈥淲e remain in regular contact with our customers and our major supply chain partners and, for steel, we benefit from relationships with a number of partners in the UK and continental Europe, reducing the risk of interruptions to the group鈥檚 steel supply.鈥�
The firm鈥檚 joint venture in India, JSSL, which has been up and running since 2008, posted an after tax loss with Severfield鈥檚 share of the figure standing at 拢700,000. It said the impact of a second wave of covid-19 hitting the country, which has given rise to the Delta variant, was hampering recovery but added that its order book had hit a record 拢140m.
Severfield said it had a year-end cash balance of 拢25m while its order book stood at 拢301m, up from the 拢287m it posted last November.
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