Severfield is the largest specialist structural steelwork group in the UK, with a growing presence in India and Europe and a reputation for performance and innovation.
Sustainable
growth in numbers
Our high-quality order book is well-diversified and contains a good mix of projects across the Group’s key market sectors with a growing amount in Europe.
ORDER BOOK (UK AND EUROPE)
Strong underlying profit before tax growth of 13 per cent in 2024 and 6 per cent annual compound growth since 2020, highlighting both organic growth and growth from selective acquisitions.
UNDERLYING¹ PROFIT BEFORE TAX
The Group’s strong cash generation allows a progressive dividend policy whilst maintaining funding flexibility to fulfil the Group’s strategy.
DIVIDEND PER SHARE
Profit before tax, which includes the impact of non-underlying expenses of £13.5m (2023: £5.4m), has decreased by £4.1m to £23.0m.
PROFIT BEFORE TAX (‘PBT’)
1 Underlying results are stated before non-underlying items. See note 33 for APM definitions.
Our year
in review
Kevin Whiteman
Chair
It has been an absolute privilege to be the Chair of Severfield. I am pleased to be leaving a business in great shape, which is performing strongly, and which has a clear strategy for further sustainable growth.
Alan Dunsmore
Chief Executive Officer
The Group demonstrated the importance of its diversified activities. Strong order books and market leading positions by delivering another year of underlying profit growth against a back drop of some challenging market conditions.
Revenue
£463.5m
Underlying profit before tax
£36.5m
Profit before tax
£23.0m
Underlying operating margin
8.1%
Operating margin
5.7%
Underlying basic earnings per share
8.9p
Basic earnings per share
5.2p
Greenhouse gas intensity¹
13.5t CO2e/£m
High-quality order books, good earnings visibility through 2024 and inflationary pressures being well managed
- Stock Code: SFR
- Revenue of £463.5m (2023: £491.8m)
- Underlying1 profit before tax up 13 per cent to £36.5m (2023: £32.5m), ahead of expectations due to strong operational delivery
- Profit before tax, including non-underlying items, was £23.0m (2023: 27.1m)
- Underlying1 basic earnings per share up 5 per cent at 8.9p (2023: 8.5p)
- Basic earning per share of 5.2p (2023: 7.0p)
- Total dividend increased by 9 per cent to 3.7p per share (2023: 3.4p per share), includes proposed final dividend of 2.3p per share (2023: 2.1p per share)
- Year-end net debt (on a pre-IFRS 16 basis1) of £9.4m (2023: net funds of £2.7m), includes Voortman acquisition loan of £15.2m, and reflects an operating cash conversion1 of 110% (2023: 145%)
- High-quality, diversified UK and Europe order book of £478m at 1 June 2024 (1 November 2023: £482m), includes higher proportion of European orders
- Momentum and value is building in JSSL – increased share of profit of £1.9m (2023: £1.3m), record EBITDA of £13m and output of over 100,000 tonnes, Gujarat expansion expected to commence in H2
- Record India order book of £181m at 1 June 2024 (1 November 2023: £165m)
- £10m share buyback programme launched in April 2024 to return surplus capital to shareholders
ESG
- The Group was awarded ‘AAA’ under MSCI’s ESG rating for the third year running
- Achieved CDP ‘A’ score for leadership on climate change mitigation and ‘A-’ for supply chain engagement, as well as maintaining our ‘very good’ BES 6001 responsible sourcing accreditation
- Science-Based Target initiative (‘SBTi’) Net Zero targets approved
- Maintained our carbon neutral accreditation from Achilles for Scope 1, 2 and operational Scope 3 emissions for our manufacturing, office and construction operations
- Listed in Financial Times Europe’s Climate Leaders report for the fourth year running
- Procured 100 per cent of our energy from renewable sources at all UK-owned facilities
- Measured social value against the National TOMs – Themes, Outcomes and Measures – methodology framework
- Maintained Gold membership of ‘The 5% Club’, demonstrating our commitment to ‘earn and learn’ apprenticeships
Except as otherwise stated ‘2023’ and ‘2024’ refers to the 52-week period ended 25 March 2023 and the 53-week period ended 30 March 2024 respectively. The Group’s accounts are made up to an appropriate weekend date around 31 March each year.
Underlying results are stated before non-underlying items of £13.5m (2023: £5.4m), including the amortisation of acquired intangible assets of £5.4m (2023: £3.3m), legacy employment tax charge £4.4m (2023: £nil), impairment of fixed assets £4.5m (2023: £nil), unwind of discount on contingent consideration of £0.3m (2023: £0.6m), fair value change in contingent consideration of £1.1m credit (2023: £0.3m credit), and net acquisitionrelated expenses of £nil (2023: £1.8m). See note 33 for APM definitions.
1 Scope 1 and Scope 2 emissions, using a market-based approach. Increase due to the inclusion of VSCH, acquired in April 2023.
OUR PURPOSE,
STRATEGY AND VALUES
Overview
Our purpose, strategy, and values are the pillars upon which sustainable success is built, they shape our identity and guide our actions.
We set the bar high
Our passion drives us to go above and beyond expectations. As experts in our field, we are focused on staying on track, maintaining a positive approach, and developing our own knowledge. Continually raising the reputation of our teams and the work that they produce comes from always challenging ourselves to do more, having an unwavering commitment to deliver industry-leading projects, and always taking the utmost pride in our work.
We are in it together
Everyone at Severfield understands that we are part of one team. By working together and recognising that we all have unique, valuable contributions, we can achieve great things. This isn’t just about sharing in everyone’s successes – it’s about creating better links between all departments and locations, making people feel supported and empowered by their colleagues, and encouraging a collaborative approach across the Group.
We do the right thing
Our focus is on what’s best for each other, our business, our clients, and our communities. As market leaders we are passionate about what we do. Whether it’s leading the way in industry safety standards or sustainable practices, always having open and honest communication with each other, or speaking up if we make a mistake, we always do the right thing.
We find better ways
We are always looking for opportunities to improve. By always being open to change and taking best practice from other colleagues and the wider industry, we can make sure that we are adaptable in a world of changing demands. Whether this is developing a procedure following lessons learned, exploring different innovative ideas put forward by colleagues, or adopting brand new ways of working, we push the boundaries of what we do.
Drive growth
Our aim is to capitalise on growth opportunities, both in the UK and Europe, and to maximise our market share.
Grow Indian presence
Our aim is to build value in JSSL and we remain very positive about the long-term development of the Indian market.
Operational efficiency
Our emphasis is on delivering high-quality projects and reducing costs by driving excellence through our core business processes.
Investment
case
01
EXCITING GROWTH PROSPECTS
- Our business covers ten core sectors, which serve a diversified range of markets, including those with strong growth potential in the UK and Europe.
- This was reinforced by the acquisition of Voortman Steel Construction Holdings B.V. (‘VSCH’), strengthening our market position in Europe, giving us a manufacturing presence and access to new high-growth sectors.
- We continue to strive to diversify, looking for new market areas where the business has not operated in the past and taking advantage of our existing capacity and expertise.
- Significant opportunity to build value in India, capitalising on the country’s strong economic growth and conversion from concrete to steel as the primary building material.
- We are in a prominent market position in the ‘green’ high-growth markets of the future, as the UK and world aim to deliver on Net Zero commitments.
02
RESILIENT BUSINESS THROUGH ECONOMIC CYCLES
- We have significant sector, geographical and client diversity, insulating us from downturns in macroeconomic cycles.
- Our business is a key provider of core infrastructure, such as transport, energy, defence, health and education – all areas that require continual investment in a prosperous economy.
- We have good earnings visibility from our high-quality order books and a strong pipeline of opportunities in the UK and Europe across all of our chosen sectors.
03
BUILT ON A PLATFORM OF OPERATIONAL EXCELLENCE
- We have an ongoing programme to drive operational improvements and efficiencies across the Group. This allows us to deliver high-quality projects for our customers, whilst optimising costs.
- Project Horizon, our digital transformation programme, is a long-term initiative to support our strategy through developing and enhancing our systems and processes and keeping us at the forefront of technology and innovation as the market leader in the industry.
- We have invested over £70m in capital expenditure over the last ten years, keeping our productions facilities and operations at the cutting edge. This will continue as we further automate our production processes through the use of robotics and other innovative methods.
04
DELIVERING STRONG RETURNS, CASH GENERATION AND PROGRESSIVE DIVIDENDS
- ROCE is an important metric for us and our five-year average ROCE is greater than 15 per cent.
- Our operations generate strong cash flows and we target the conversion of more than 85 per cent of our annual profit into cash.
- The Group has a well established capital allocation policy to support and grow the Group to increase value for shareholders, whilst having a progressive dividend policy to pay sustainable core dividends in line with profit growth.
- We recently announced a share buyback programme to retrurn up to £10m to shareholders.
05
ALL UNDERPINNED BY A STRONG FOCUS ON SUSTAINABILITY
- Awarded ‘AAA’ under MSCI’s ESG rating.
- Achieved CDP ‘A’ list rating, recognising our transparency on climate-related disclosures.
- In 2024, we received validation from the SBTi (‘Science Based Targets initiative’) of our Net Zero targets for reducing GHG emissions.
- We have delivered progress against our SBTi targets, achieving a 10 per cent reduction in emissions in the year.
- Our market-leading approach to ESG has been recognised in our listing in the Financial Times Europe Climate Leader’s report for the fourth year running.
- Member of the United Nations ‘Race to Net Zero’ Campaign.
- We are a SteelZero signatory – making the commitment to procure 100 per cent low-carbon steel by 2050.
- Our manufacturing and construction operations are accredited as carbon neutral by Achilles.
What we do
We manage every aspect of the fabrication and construction process, from initial scheme design, through detailing, specification and manufacture, to the eventual handover to our clients of a quality product on-site. By engaging with our clients in the design stage, we can add 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.
Our diversified
portfolio
As the UK’s market-leading structural steel company, we serve people every day, whether for work, leisure or travel, or to provide essential services, including power and energy, health and education.
We have extensive experience in multiple market sectors, which supports the business through changes in spending patterns and fluctuations in macroeconomic conditions. In other words, we have a balanced portfolio with market sector, geographical and client diversification.
core construction sectors
Commercial and industrial
- Commercial Offices
- Industrial and distribution
- Data centres
- Retail
- Health and education
- Stadia and leisure
Nuclear and infrastructure
- Nuclear
- Power and energy
- Transport infrastructure
- Process industries
ORDER BOOK BALANCE
The Group’s growth strategy has delivered a high-quality UK and Europe order book with a broad diversity of sectors, geographies and clients, providing us with good earnings visibility through 2024 and beyond.
Our
projects
81 NEWGATE STREET
LONDON
81 Newgate Street highlights Severfield’s key role in the ‘circular economy’ – the project involves the structural redevelopment of an existing building to reuse space and increase its efficiency to develop a ‘green’ building for the future. Formerly the home of BT, the 1980s structure situated next to the historic St Paul’s Cathedral is undergoing a transformation to become one of the most energy-efficient buildings in London.
AESC UK
SUNDERLAND
Severfield supplied a significant amount of structural steelwork for AESC UK’s cutting-edge battery plant in Sunderland. The state-of-theart facility will produce their latest generation batteries, enabling the production of around 100,000 electric vehicles annually and creating over 1,000 hi-tech jobs in the UK.
HS2 CURZON TRIPODS
CURZON STREET, BIRMINGHAM
The Curzon Street Tripods form an integral part of the High-Speed Two (HS2) infrastructure, providing support for a viaduct over the Digbeth Street Canal. The project highlights Severfield’s strong expertise in the bridge infrastructure sector.
LUCENT
LONDON
Severfield contributed to the construction of Lucent, a new 144,000 sq ft building located behind the iconic Piccadilly Lights in central London. The existing island site was made up of multiple properties. Lucent has redeveloped this site to deliver a mixed-use development delivering firstclass office spaces, shops, apartments, and a rooftop restaurant.
OXFORD HUMANITIES
OXFORD UNIVERSITY
Severfield contributed to the design and construction of six distinct and individually supported steel structures that will form the basement level of the new Humanities building at Oxford University. The new building will bring together related faculties and institutions and libraries and collections into one home, including space for a 500-seat concert hall and 250-seat lecture theatre.
SEAH MONOPILE FACILITY
TEESWORKS, MIDDLESBOROUGH
Severfield is providing an impressive 35,000 tonnes of structural steelwork for the giant monopile factory on Teesside for SeAH Wind, a subsidiary of South Korean steel manufacturer SeAH. Upon completion, this will be the largest monopile facility in the world, measuring an impressive 810 metres by 210 metres, and creating up to 750 direct jobs and a further 1,500 jobs in the supply chain. This superstructure is one of the largest projects we’ve worked on to date.
SELLAFIELD SRP
SELLAFIELD, CUMBRIA
The Sellafield Product and Residue Store Retreatment Plant (SRP) project is part of a multi-billion-pound project funded by the Nuclear Decommissioning Authority (NDA) to provide safe long-term storage and processing of nuclear materials. Severfield is trusted to be a part of this complex project, with our scope involving the connection design, fabrication, and erection of a nuclear seismic structure. Upon completion, this facility will be essential in ensuring the safety and security of nuclear materials.
