SUSTAINABLE
GROWTH IN NUMBERS

Delivering on our promises

2020 strategic profit target of
£26m exceeded

Strong UK and Europe order book

Our Year
In Review

Revenue

Revenue

£327.4m


Underlying profit before tax

Underlying* profit
before tax

£28.6m


Underlying operating margin

Underlying*
operating margin

8.2%

Profit before tax

Profit before tax

£25.8m


Underlying* basic earnings per share

Underlying* basic earnings per share

7.7p


Net funds

Net funds**

£16.4m

Revenue

£327.4m

Underlying profit
before tax

£28.6m

Underlying operating margin before tax

8.2%

Profit before tax

Profit before tax

£25.8m

Underlying* basic earnings per share

7.7p

Net funds

Net funds**

£16.4m

Strategic 2020 profit target achieved, good cash generation and a strong balance sheet

  • Revenue up 19% to £327.4m (2019: £274.9m)
  • Underlying* profit before tax up 16% to £28.6m (2019: £24.7m), ahead of strategic 2020 profit target of £26m
  • Underlying* basic earnings per share up 15% at 7.7p (2019: 6.7p)
  • Acquisition of Harry Peers for net initial cash consideration of £18.9m, contingent consideration of up to £7m payable in 2021
  • Good cash generation resulting in year-end net funds (excluding IFRS 16 lease liabilities**) of £16.4m (2019: £25.1m), including the outstanding acquisition loan of £13.1m for Harry Peers
  • Over 100 projects undertaken during the year in the UK, Ireland and continental Europe in diverse market sectors including industrial and distribution, data centres, commercial offices (both in London and the UK regions) and transport infrastructure
  • UK and Europe order book of £271m at 1 June 2020 (1 November 2019: £323m), including £17.0m for Harry Peers – the expected reduction reflects revenue recognised in H2 on several large ongoing contracts
  • Share of profit from Indian joint venture ('JSSL') up 80% at £2.2m (2019: £1.2m), reflecting both revenue growth and margin improvement
  • India order book of £110m at 1 June 2020 (1 November 2019: £134m), expansion of the Bellary facility is now complete

* Underlying results are stated before non-underlying items of £2.8m (2019: £nil) consisting of the amortisation of acquired intangible assets of £1.4m and acquisition-related expenses of £1.4m.

** The Group excludes IFRS 16 lease liabilities from its measure of net funds/debt as they are excluded from the definition of net debt as set out in the Group's borrowing facilities.

HOW WE DELIVER
GROWTH FROM A
STRONG FOUNDATION

01

Our Vision

Our vision is to be recognised as world-class leaders in structural steel, known for our ability to deliver any project to the highest possible standards.

02

Our Mission

As ambitious, innovative leaders in a demanding and ever-developing industry, we will use our collective strengths and resources to build the capacity required to deliver the structures of the future.

03

Our strategy

Our strategy revolves around five main elements. This is aided by our business improvement programme, ‘Smarter, Safer, more Sustainable’.

Growth
Clients
India
Operational
Excellence
People

04

Our Values

  • Safety

    There’s a reason it’s known as ‘safety first’. We make no apologies for the fact that profit and loss, deadlines and headlines all come second to making sure everyone goes home safely every day.

  • Integrity

    We operate in a complex and challenging industry, one that often requires innovative thinking and a flexible approach to deliver successful outcomes. The one thing we’ll never compromise on is our integrity, which ensures we’re able to maintain the exceptionally high standards we set for ourselves.

  • Customer Focus

    Our clients are paramount in all that we do. We are here to understand their requirements and meet their aspirations. Together we will deliver projects of which we can all be proud.

  • Commitment

    We may move with the times, but our long and rich history means that we have a few old-fashioned beliefs. One of those beliefs is that you stand by your word. When Severfield say we’ll deliver, whatever challenges lie ahead, you can depend on us to deliver, and to the highest possible standards.

Chairman's view

John Dodds director
WE CONTINUE TO MAKE PROGRESS IN EXECUTING OUR STRATEGY AND HAVE EXCEEDED OUR 2020 STRATEGIC PROFIT TARGET OF £26M.

John Dodds

Non-executive chairman

Our operating performance

Alan Dunsmore director
THE GROUP HAS DELIVERED AN EXCELLENT SET OF RESULTS IN 2020.

Alan Dunsmore

Chief executive officer

Our financial performance

Adam semple director
REVENUE FOR THE YEAR IS UP 19 PER CENT, REFLECTING ORGANIC GROWTH AND THE SECOND HALF ACQUISITION OF HARRY PEERS.

Adam Semple

Group finance director

OUR UNIQUE
OFFERING

We continue to invest in what differentiates us, strengthening our long-term proposition.

01

Client focus

We are committed to providing outstanding customer service. An essential part of project delivery is understanding our clients’ requirements and aspirations. This builds secure, sustainable and mutually valuable relationships and creates lasting client satisfaction.

02

Market leader

Severfield is the UK’s market-leading structural steel company, respected for delivering world-class engineering and design excellence. We have unrivalled experience and capability in the design, fabrication and construction of steel structures. The breadth of technical expertise in our workforce ensures that we can serve a diverse range of market sectors, positioning us well for future growth.

03

Integrated approach from design to construction

By engaging with our clients in the design stage, our understanding of their requirements is enhanced and adds value throughout the project life cycle. Our in-house design and construction teams work closely together to create the most efficient and safest solutions that match our clients’ needs.

04

Benefits of scale

Severfield is the largest structural steel business in the UK and one of the largest in Europe, with an expanding presence in India, providing unrivalled capacity and capability allowing us to share our expertise across a wide range of market sectors to deliver cost-effective and innovative steel structure solutions.

05

Innovation

Innovative thinking is integral to our approach, giving us flexibility in how we deliver projects for our clients. This means that our business can easily adapt to the trends across all the sectors that we serve. Our business model is based on a virtuous cycle of growth, investment and innovation.

06

Operational excellence

Our board of directors and employees have a wealth of experience in the construction industry. We have a track record of successful operational performance on many of the UK’s most iconic structures. Our ‘Smarter, Safer, more Sustainable’ team are focused on delivering internal efficiency improvements to support the Group’s operational efficiency and effectiveness.

07

Productivity and growth

Our disciplined use of capital for investment in market-leading technology, plant and equipment leads to higher quality products with a shorter turnaround, increasing the productivity of our operations. Alongside our targeted strategies for growth and operational excellence, our business model illustrates the Group’s clear plan to develop and increase our market share and maximise shareholder returns.

08

Supply chain strengths

Careful management of the supply chain is an essential part of improving efficiency. We choose supply chain partners who match our expectations in terms of quality, sustainability and commitment to client service.

Smarter, Safer,
More Sustainable

Our business improvement programme represents the consolidation of all of the Group’s ongoing improvement projects, established to help us deliver the Group’s overall strategy. These include improvements in business processes, use of technology, operating efficiencies and new product development, all set within the framework of strong risk management and control.

Smarter

Improve how we deliver our projects with speed, efficiency and accuracy.

Safer

Continue our relentless focus on safety and always think 'safety first'.

More Sustainable

Focus on working sustainably and reducing our environmental impact and carbon emissions.

Key Performance
Indicators

underlying-operating-profit

Underlying* operating profit and margin (before JVs and associates)

Strategic pillar


Underlying basic earnings per share (‘EPS’)

Underlying* basic earnings per share (‘EPS’)

Strategic pillar

Revenue growth (on a like-for-like basis)

Revenue growth (on a like-for-like basis)

Strategic pillar

Operating cash conversion

Operating cash conversion

Strategic pillar

Return on capital employed ('ROCE')

Return on capital employed ('ROCE')

Strategic pillar


Order book

Order book

Strategic pillar

Accident frequency rate ('AFR')

Accident frequency rate ('AFR')

Strategic pillar

underlying-operating-profit

Underlying* operating profit and margin (before JVs and associates)

Strategic pillar

Underlying* basic earnings per share (‘EPS’)

Underlying* basic earnings per share (‘EPS’)

Strategic pillar

Revenue growth (on a like-for-like basis)

Strategic pillar

Operating cash conversion

Strategic pillar

Return on capital employed ('ROCE')

Return on capital employed ('ROCE')

Strategic pillar

Order book

Order book

Strategic pillar

Accident frequency rate ('AFR')

Strategic pillar

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ABOUT

Building on our strong foundations

How We Create Value

The Markets We Serve

Our strategy

How We Manage Risk

Building a sustainable business