Hargreaves faces ‘challenging’ market

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HARGREAVES Services today revealed that it is facing “very challenging” and “unprecedented” market conditions.

In a statement to accompany its interim results, Hargreaves Services said it had delivered a resilient performance in difficult markets.

In the six months ended November 30 2014, the company’s continuing revenue fell by 23.7 per cent to £351.2m, while continuing profit before tax fell by almost half to £15.2m. However, the interim dividend rose by 13.6 per cent to 10.0p.

The company said its group simplification and the debt reduction initiative are progressing well. These initiatives have included the disposal of the Imperial Tankers operation and the closure of the Monckton coke operation, near Barnsley.

Commenting on the interim results, the chairman Tim Ross said: “The market conditions we are currently experiencing are unprecedented and very challenging.

“The group simplification programme and focus on reducing debt ensures that the group is well placed to weather the current difficult trading conditions for such time as they persist.

“Although there are challenging times to face in the coming financial year, the group is expected to continue to be profitable and to generate meaningful surplus cash. Reflecting the group’s inherent strength and solid financial position, the board has the confidence to increase the interim dividend in line with prior guidance.

“Although we are unable to control factors such as coal price and coal demand, the management team is proactively taking all the sensible steps and measures to manage current market conditions whilst leaving the group well placed to benefit when the market improves.”