reports
Severfield: 1 director
A director at Severfield bought 103,125 shares at 24p and the significance rating of the trade was 53/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years clearly showing...
- Hybridan Team
Hybridan Small Cap Feast: 24/04/2025
Our daily digest of news from UK Small Caps 24th April 2025 @HybridanLLP * A corporate client of Hybridan LLP ** Potential means Intention to Float (ITF) has been announced, or it is a rumour ***Arranged by type of listing and date of announcement ****Alphabetically arranged Dish of the day Admissions: None Delistings: None What’s baking in the oven? Potential** Initial Public Offerings: 18th March: Uranium Energy Exploration,...
- Hybridan Team
- Jon Levinson
Hybridan Small Cap Feast: 03/03/2025
Our daily digest of news from UK Small Caps Our daily digest of news from UK Small Caps @HybridanLLP 3rd March 2025 * A corporate client of Hybridan LLP ** Potential means Intention to Float (ITF) has been announced, or it is a rumour ***Arranged by type of listing and date of announcement ****Alphabetically arranged Share prices and market capitalisations taken from the current price on the day o...
- Toby Thorrington
Severfield - Short-term issues cloud long-term outlook
Severfield remains the leading UK structural steel fabricator, with a strong presence in Northern Europe and an Indian joint venture. However, news that it is required to remediate 12 bridge structures and that its underlying markets are showing signs of short-term weakness have resulted in a downgrade to profit estimates and a material share price correction. We believe the markets will recover in time and that there is potential for third-party cost recoveries relating to the bridge issues, bu...
- Toby Thorrington
Severfield - Poised for expansion
The highlight of Severfield’s FY24 results was the 14% increase in underlying operating profit despite declining revenue. This gives a clue to the increasing quality of earnings as the company captures future projects and benefits from its internal digitalisation programme, Project Horizon. Furthermore, the Indian JV rapidly improved profit and is expanding capacity to meet growing demand. The balance sheet offers scope for both the £10m share buyback and potential M&A. Our forecasts are unchang...
- Toby Thorrington
Severfield - Performing well with improving outlook
Severfield’s FY24 results demonstrate robust profit growth despite declining revenue, and management highlighted the positive outlook in its key markets of the UK, Continental Europe and India. The total order book has also remained at elevated levels despite the loss of the £50m Sunset Studios order, highlighting the underlying future earnings visibility. The FY25e P/E rating of 8.1x is comfortably below the long-term average of c 10x, implying material risk is discounted in the rating. The sto...
- Toby Thorrington
Severfield - Multiple positives should excite investors
Severfield’s trading update indicates that FY23 results are expected to slightly exceed market expectations and the company ends the year with a record UK and Europe order book. Furthermore, with a positive trading outlook and net debt coming in lower than expected, Severfield has announced a £10m share buyback, highlighting the cash-generative nature of the company and management’s confidence in its position. The stock trades on an FY25 P/E of less than 6x and yields 7%, which we believe appear...
- Toby Thorrington
Severfield - FY24 expectations unchanged, order book robust
Severfield’s H124 results highlighted profit growth despite declining revenue, and management continues to expect full-year results to be in line with previous guidance. The total order book has also remained at elevated levels despite the loss of a large studio contract, highlighting the quality of future work in the UK and Europe, and that it is a key indicator of future earnings visibility. The FY24e P/E rating of 7.0x is comfortably below the long-term average of c 10x, implying some risk is...
- Toby Thorrington
Severfield - FY24 in line, but risks edge up further on
Severfield’s AGM statement highlights that FY24 is expected be in line with management expectations and that the quality of the orderbooks – both in the UK and Europe, and India – remains a key support for the future. That said, the outlook for the UK and continental Europe is less robust in the short term than it was due to the impact of high inflation and the rising interest rate cycle. The FY24e P/E rating of c 7x remains comfortably below the long-term average of 10.0x, implying that some ri...
- Toby Thorrington
Severfield - FY23 results highlight progress and strength
FY23 results highlight that we believe revenue quality remains materially underappreciated by the market (see our June update note), especially now the UK and EU are embarking on huge investment programmes to renew and upgrade infrastructure. In our view, the outlook in the UK, continental Europe, especially post recent M&A, and India is not fully reflected in the FY24e P/E rating of c 7.5x, which is comfortably below the long-term average of 10.0x. Our positive stance is supported by the compan...
- Toby Thorrington
Severfield - Revenue visibility and growth underappreciated
The quality of Severfield’s revenues is materially underappreciated by the market in our view, especially now that the UK and EU are embarking on huge investment programmes to renew and upgrade infrastructure to address global trends, such as the drive for net zero emissions. The reorganisation of the group, the internal improvement project (Project Horizon) and the EPS-enhancing M&A deal are not fully reflected in the FY24e P/E rating of c 7.0x, which is comfortably below the long-term average ...
- Liberum Research Team
- Liberum Research Team
- Alex O’Hanlon
- Joe Brent
- Sanjay Vidyarthi
LIBERUM: Severfield* - Site visit to Lords highlights growth prospects
Site visit to Lords highlights growth prospects, both organic and acquisitive. Looking at the three divisions; 1) At Commercial and Industrial, the new divisional structure provides greater clarity to customers; 2) Nuclear and Infrastructure is the key revenue growth engine; and 3) Modular Solutions is the smallest division but should be capable of the highest margins. Looking at the business as a whole; 1) The new divisional disclosure shows the £5m to £6m recovery potential at Modular Solution...
- Liberum Research Team
- Liberum Research Team
- Alex O’Hanlon
- Joe Brent
- Sanjay Vidyarthi
LIBERUM: Severfield* - In line earnings and strong order book growth
Trading update indicates trading has been in line with expectations with a 65% PBT weighting to H2. We maintain our earnings estimates. Severfield is largely hedged against higher energy costs, although we assume a £1m hit in FY 25 which could prove conservative. We maintain our pre IFRS 16 FY 23 net debt estimate of £13m but expect this to increase to £25m in FY 24 as the VSCH acquisition completes. We make four key points: 1) The VSCH acquisition announced on 15 March is an accretive and strat...
- Liberum Research Team
- Liberum Research Team
- Alex O’Hanlon
- Joe Brent
- Sanjay Vidyarthi
LIBERUM: Severfield* - Accretive and strategically sensible acquisitio...
Severfield announces the acquisition of a European steel fabrication company. The net consideration is €24m payable in cash on completion. The deal should be revenue and cost synergistic. There is scope to grow in the Netherlands and neighbouring EU countries. We estimate 6% and 7% accretion in FY 2024 and FY 2025 respectively. The estimated price paid of FY 24 EV/EBIT of 5.9x seems reasonable. A revised CY 23 P/E of 7.1x is attractive, given the growth potential.
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