Hargreaves Services plc
(“Hargreaves” or the “Group”)
Improved trading from German JV
Further upgrades to expected profits from HRMS
Hargreaves Services plc (AIM: HSP), a diversified group delivering services to the industrial and property sectors, announces further improvements to its expected trading results due to the continuing strong performance of its German Joint Venture, Hargreaves Raw Materials Services GmbH (“HRMS”).
As noted in the statement released on 15 March 2022, commodity prices, specifically pig iron and zinc, are continuing to have a positive benefit on the results of HRMS and its subsidiary, DK Recycling und Roheisen GmbH (“DK”). The HRMS management team has indicated that they are confident that HRMS has sufficient visibility for the remainder of the current financial year to expect its contribution to Hargreaves' results to increase by approximately £5m after tax from prior consensus estimates. Additionally, the Board expects some benefit to fall into the first quarter of the year ending 31 May 2023 resulting in an increase of approximately £1.5m after tax against consensus estimates.
It remains difficult to predict how long these favourable market conditions will prevail and both the German management team and the Board remain cautious about the medium term sustainability of these conditions.
The remainder of the Group's businesses continue to trade in line with market expectations.
Commenting on HRMS' improved trading performance, Roger McDowell, the Chairman of Hargreaves, said: “Clearly current market conditions are extremely favourable and the Board is impressed with the way in which the HRMS team is successfully navigating the opportunities that the market is presenting.”