Severfield’s pre-tax margin has passed 8 per cent following the delivery of a number of high-profile jobs in London.
The Yorkshire-based structural steel firm reported pre-tax profit of £22.2m for the year to 31 March 2018, up from £18.2m in the previous 12 months.
Revenue increased from £262.2m to £274.2m, with the company delivering steelworks on high-profile jobs including the new Tottenham Hotspur stadium (pictured) and the Wimbledon Court One roof.
Severfield posted a pre-tax margin for the year of 8.1 per cent, having set itself the target of achieving 8-10 per cent pre-tax margin by 2020.
Improved profitability came from improvements in its factory processes along with better contract management, according to the firm.
Severfield’s joint venture in India with steel producer JSW Steel to supply structural steel in the country also yielded improved results in the year to March.
The company’s share of pre-tax profit in the JV increased from £0.2m to £0.5m, while its order book jumped from £73m to £106m.
Its UK order book at the start of this month stood at £237m, of which £200m will be realised in the next 12 months.
Chief executive Alan Dunsmore, who took over from Ian Lawson in March, said: “With a high-quality and stable UK order book of £237m and a strong pipeline of opportunities which provides us with good visibility of earnings, together with an encouragingly improving outlook for our Indian joint venture, we remain confident that 2019 will be another year of progress for the group.”
Severfield said the UK market looks “stable” with modest growth expected, “despite the uncertainties of Brexit” .
Demand for data and distribution centres in particular is expected to remain strong, while the firm recruited more than 200 new staff across the business during the year to March.
Severfield also secured high-profile commercial jobs in London, including the expansion of Westfield in Stratford and work on Google’s headquarters in King’s Cross, with the latter expected to bring in around £50m in revenue.
The company revealed in its accounts that remedial work to replace bolts on the Leadenhall Building was completed last year, but that liability for the cost of the work was still being discussed.
In 2014 a bolt fell from the central London skyscraper while three others were found to have fractured, leading to Severfield having to replace 3,000 bolts on the building.
The company made a £6m provision for this cost in its 2015 accounts.