AUS
NZ
UK
CA
USA
IND
Hargreaves Services plc (AIM: HSP), a diversified group delivering services to the industrial and property sectors, is pleased to provide an update on trading ahead of its preliminary results for the year ended 31 May 2024. The Board expects to report Profit before Tax (PBT) slightly ahead of market expectations.
Services Business Unit Performance
The Services business unit continued to excel throughout the second half of the year, building on a robust first-half performance. The Board anticipates reporting year-on-year growth in divisional PBT, even after adjusting for a £3.2 million one-off gain recorded in the prior year. This growth has been driven primarily by the Earthmoving and Environmental operations within the Services business.
Hargreaves Land Achievements
Hargreaves Land also experienced a strong second half, highlighted by significant deal completions, including a residential site at Maltby and the land occupied by an 'Energy from Waste' plant at Westfield. Consequently, the Board expects this business unit to report a record PBT for the year, slightly higher than previously anticipated. This increase is attributed to the early completion of several option fees for renewable energy ground leases. Despite the rise in PBT, headline revenue for Hargreaves Land is expected to be lower than expectations due to a higher proportion of profits coming from sales of Investment Properties. The business unit remains well-positioned to bring the first tranche of renewable energy land assets to market in the financial year ending 31 May 2025.
German Joint Venture Recovery
The Group's German Joint Venture, Hargreaves Raw Materials Services GmbH (HRMS), faced a challenging first half of the year. However, the Board expects to report a substantial improvement in performance in the second half, in line with expectations. This turnaround is partly due to the seasonality, with the annual plant maintenance period occurring in the first half. Additionally, trading volumes have improved, and the recycling operation has begun to see increased gate fees and pig iron pricing, trends expected to continue into the new financial year.
Financial Position
As of 31 May 2024, the Group held cash reserves of £22.7 million, compared to £21.9 million in 2023. During the year, the Group paid £7.7 million related to the buy-in of the pension scheme, including a £4.0 million loan. This investment has offset the cash generation within the Group.
The preliminary results announcement scheduled for 15 August 2024 will provide further insights into the company's performance and strategic direction. Investors and stakeholders can look forward to a comprehensive update on Hargreaves Services' operational and financial progress, setting the stage for continued growth and success in the coming years.
