Havelock Europa : Interim Results 2016

Posted on 22nd September 2016

Financial Highlights

• Strong public sector demand has enabled the Group to deliver revenue of £25.4m (2015: £28.9m), despite the expected downturn in corporate sector activity and a weaker retail sector.

• The operating loss, before tax, was more than halved in the period to £0.7m (2015: £1.6m), reflecting the benefits accruing from business decisions made in late 2015.
• The investment in the new business structure and our Enterprise Resource Planning (ERP) project led to a small increase in net debt to £3.6m at the half year (2015: £3.1m).

Operational Highlights

• Anticipated overhead reductions achieved, with further savings being identified and realised.
• The drive to simplify and standardise the business has resulted in strong margin improvement against H1 2015.
• Higher Public Sector volumes offsetting reduced Corporate Sector and Retail and Lifestyle demand.
• Developed new Retail and Lifestyle customers in the period, growing a significant pipeline of opportunities.
• Expanded design capability to help develop the new customer pipeline and the launch of a London design office to further increase our coverage.
• International sales delivering over 15% of turnover.

Outlook

• Business reorganisation is on track, with main cost savings delivered. Focus now on developing deeper relationships with existing and new customers.
• The vote for Britain to leave the European Union and subsequent political developments have increased the market uncertainty across our customer base.
• Pricing pressure has increased post the Brexit vote. Activity within the Retail and Lifestyle Sector remains subdued.
• However, trading remains in line with market expectations.

David Ritchie, Chief Executive Officer of Havelock Europa, said: 'I am pleased to be able to report that, largely due to the actions we took last year to right size the business and standardise business processes, the business has benefited from strong margin improvement which has led to a significant reduction in the first half loss compared to last year. In addition, strong demand from the public sector has helped to offset weakness in retail and the expected downturn in the corporate sector.'

Enquiries

Havelock Europa PLC - 01592 643883
David Ritchie, Chief Executive
Ciaran Kennedy, Finance Director

WH Ireland Group plc (Nomad) - 0207 220 1650
Chris Fielding

Charlotte Street Partners - 0131 513 5310
Robert Ballantyne
David Gaffney