Billington cheers investors with revenue and profit hike

Structural steel firm Billington Holdings has cheered the market with the news that its 2019 results will be better than expected.
Billington is one of the UKs leading structural steelwork contractorsBillington is one of the UKs leading structural steelwork contractors
Billington is one of the UKs leading structural steelwork contractors

The Barnsley-based firm anticipates that annual revenue for the year to December 31 will be higher than the current market expectation of £78m following the successful completion of a number of large projects in the year.

It added that annual profits are also expected to be above the market forecast of £5.2m and it envisages the level of cash generation to be similarly positive.

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Chief executive Mark Smith said: "We are pleased to be able to announce this increase in our expected outturn for the year.

"The current political and economic uncertainties will undoubtedly present challenges for the company in 2020.

"However, the positive momentum, the company's strong market position and robust and consistent financial performance leaves it well placed to move forward into 2020 and beyond with confidence."

Analyst John Cummins at WH Ireland said: "Billington has issued a positive update in respect to trading in the year to 31 December 2019.

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"Management indicates that revenue will be above our 2019 expectations due to the ‘successful completion of several large projects’, this also benefiting profit (although to a lesser extent) and cash generation.

"Unsurprisingly, the forward assessment of 2020 is more cautious given present political and economic uncertainties.

"As such, although our 2020 estimates are unchanged this morning, our 2019 adjusted pre-tax profit and earnings per share estimates increase 6 per cent to £5.5m and 36.1p respectively (from £5.2m and 34.1p), with our year end net cash estimate increasing to £11.0m (from £9.2m). We see fair value at 370p."

In June Billington announced it had won two significant contracts with a combined value of £30m.

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The first contract is to provide steelwork for a large, local, town centre redevelopment scheme, which involves the construction of a number of new retail and leisure facilities. The scheme is thought to be close to Billington's Barnsley base, but the firm refused to confirm this.

The second contract is to supply the structural steelwork for a large distribution warehouse in the North East of England.

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