Edison Investment Research - Severfield (SFR) Severfield - Good end-FY19 order book momentum

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Edison Investment Research

Toby Thorrington

Severfield - Good end-FY19 order book momentum

Higher order books in the UK and India are a positive way to end FY19, which concluded in line with previous guidance. UK market conditions appear to be stable while India is continuing to strengthen. Year-end net cash is similar to H1, and slightly below where we had previously expected, but Severfield retains its conservative balance sheet position. Save for the net cash adjustment, our estimates are unchanged; the P/E rating reduces from 11.1x for the trailing year to 10.3x for FY20 with EV/EBITDA equivalents of 6.8x and 5.9x respectively.

29/04/2019 3 EN

Underlying

Severfield

Severfield is a structural steelwork company, engaged in construction contracts business. Co. serves the construction and infrastructure markets, which cover a range of clients from contractors and developers, to engineers and architects. Co.'s construction sectors consist of commercial offices, Industrial and distribution, stadia and leisure, retail, and data centers and other. Co.'s infrastructure sectors consist of transport, power and energy, and health and education. Co. manages the fabrication and construction process, from initial scheme design, through detailing, specification and manufacture to the eventual handover to clients.

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GB00B27YGJ97 London Stock Exchange United Kingdom

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Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Toby Thorrington

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Severfield - Good end-FY19 order book momentum

Severfield - Multiple positives should excite investors

Severfield - FY24 expectations unchanged, order book robust

Severfield - FY24 in line, but risks edge up further on

Sylvania Platinum - Annual guidance maintained, despite strike

1Spatial - Investing in the transformational SaaS opportunity

Datatec - FY24 underlying EPS more than doubles y-o-y

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