Hill & Smith’s slim 2.5% improvement in pre-tax profits to £1.77m from sales down 3% at £40.3m was hardly an exciting first half result.
But it was good enough compared to the poor £1.2m of the second half last year to put a few pence on the long-depresssed share price.
Most sections of the forging to building products group did better this time, although operating profits slumped 27% to just under £500,000 in steel stockholding, an interest that does not fit well with the rest of the group. City watchers reckon it will be sold once steel prices improve.
Despite a sharp fall from its peak of the early 1990s when the highways programme was in full swing, road furniture – barriers, fencing, drainage – was still the strongest performer with profits up 38% at £1.13m.
And the division is building up a strong galvanising business with capacity to take on outside work. Building products remain shadowed by poor cable TV demand, and profits slipped a little. The fourth division – forging – produced slightly better figuresBroker Williams de Broe forecasts £4m pre-tax (£2.92m) for the full year with earnings of 7.3p, and for next year of £4.7m and earnings of 8.3p.
Hill & Smith has invested nearly £20m in recent years to create `a new core of modern businesses to replace our more mature products,’ said Michael Sara, chairman.
It looks as if that is now set to pay off.