Severfield is a leading UK structural steelwork fabricator operating across a broad range of market sectors. An Indian facility undertakes structural steelwork projects for the local market and was expanded in FY20.
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Severfield’s FY22 results confirmed a strong H2, successfully delivering orders won in the previous 18 months or so. Notwithstanding input cost inflation, absolute levels of operating profit, including JVs, increased 6.7% to £28.2m. Severfield’s Indian JV (JSSL) also hit management expectations, including further profitable trading in H2. The UK and India both ended FY22 with record order books reflecting inflationary effects to some extent but the underlying order intake has clearly been healthy. The company’s FY23 expectations remain unchanged with strong trading being offset by inflationary pressures. A P/E of around 7x and a dividend yield of c 6% are attractive measures.
Y/E Mar |
Revenue (£m) |
EBITDA (£m) |
PBT (£m) |
EPS (fd) (p) |
P/E (x) |
P/CF (x) |
|---|---|---|---|---|---|---|
| 2021A | 363.3 | 29.6 | 24.3 | 6.68 | 9.3 | 5.6 |
| 2022A | 403.6 | 33.4 | 27.1 | 7.00 | 8.9 | 4.7 |
| 2023E | 460.1 | 37.8 | 31.2 | 8.30 | 7.5 | 4.3 |
| 2024E | 473.9 | 40.3 | 33.6 | 8.88 | 7.0 | 4.1 |
Industry outlook
The primary strategic aim is to maintain Severfield’s position as the leading UK structural steelwork supplier. JSSL targets similar sectors to those served in the UK; management has valued the Indian construction market at c £100bn pa, with a very low penetration of steel structures currently.
Last updated on 30/11/2022Content on Severfield
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Industrials
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Share price graph
Balance sheet |
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| Forecast net debt (£m) | 13.7 |
| Forecast gearing ratio (%) | 6 |
Price performance
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Key management |
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| Alan Dunsmore | CEO |
| Adam Semple | CFO |