Turnover at BSS Group in the 19 weeks to 10 Februray 2010 is in line with expectations at £473.4 million, 0.9 per cent above last year on an equivalent working day basis.
Like for like revenue, excluding the impact of new branches and acquisitions, was 2.1 per cent below last year (against a 6.8 per cent like for like reduction in the six months to 30 September 2009).
Colder weather conditions during December benefited the Domestic Division as repair and maintenance activity increased with boiler usage.
Snow disruption in January caused some loss of business, primarily domestic contract work, but the adverse impact was offset by the better performance in December.
BSS anticipates that government capital expenditure, which will represent around 10 per cent of group turnover in the current financial year, will reduce significantly in the coming years.
The firm is pursuing new revenue streams to offset the expected reduction in public sector activity beyond the current financial year.
BSS said: “The group has faced considerable challenges in the current year with recession in the broader economy resulting in a contraction in a number of core markets, reducing demand and bringing a more competitive price environment.
“The group has reacted quickly to the changing market conditions, scaling down appropriately and re-positioning resource to present a leaner, fitter business that is focussed on new growth opportunities.
Further progress has been made in the period:
- Direct Heating Spares is moving to seven day operations on the back of contract gains and stronger underlying demand; 12 new implant branches have been opened financial year to date in support of our expansion into the above ground drainage market (with a further six to be opened in February and March). The recent acquisition of UGS Limited (‘UGS’) gives BSS the opportunity to service the broader drainage market (above and below ground) which we believe has significant growth potential.
- Renewables revenue continues to grow at pace and the first orders have been received in support of the water industry upgrade which will be serviced from our dedicated distribution facility in Nottingham.
- Management remains confident that the new revenue opportunities targeted can offset the impact of a contraction in public sector investment in the coming years.