Hargreaves Services plc
(“Hargreaves” or the “Group”)
Pre-Close Trading Update and Notification of Preliminary Results
Hargreaves Services plc (AIM: HSP), a diversified group delivering services to the industrial and property sectors, provides the following update on trading ahead of reporting its preliminary results for the year ended 31 May 2022.
The Board expects to report results ahead of market expectations, due to the continued strong performance of the Group's Joint Venture in Germany (“HRMS”). As noted in the statement released on 3 May 2022, commodity prices, including zinc and pig iron, have maintained their high level, which has led to an expectation that HRMS' contribution to the Hargreaves results for the year ended 31 May 2022 will now be £3.5m after tax greater than prior consensus estimates.
The Board anticipates reporting strong results in each of its business segments. Revenue will be lower than the prior year due to the cessation of its coal activities, Profit before Tax (“PBT”) is expected to be higher. This improvement on the prior year PBT is anticipated due to increased contributions from the Services and HRMS businesses.
At the end of the financial year, the Group had no bank debt and held cash of £14.0m (31 May 2021: £28.3m). The reduction in cash is due to the provision of an additional short term loan of £15m to HRMS to assist with their trading capacity. The Board has decided to continue to provide this additional funding to HRMS whilst current favourable market conditions prevail. The only non-bank debt held by the Group, excluding its joint ventures, relates to leasing debt related to specific fixed assets. The total leasing debt at the year-end was approximately £18.1m (31 May 2021: £11.8m). The increase is a result of the investment in the plant required for the HS2 contract within Services.
Notification of Preliminary Results
The Board expects to report its preliminary results for the Financial Year on Wednesday 27 July 2022. Details of the analyst meeting to accompany the results will be provided in due course.