Hill & Smith flags positive start to year

23rd May 2024 11:53

(Sharecast News) - Infrastructure products specialist Hill & Smith reported a positive start to the year in an update on Thursday, slightly exceeding expectations.

The FTSE 250 company, which was holding its annual general meeting, said it saw a 5% increase in revenue on a constant currency basis, driven by strong market demand for infrastructure solutions in the US, which offset a more challenging market environment in the UK.

It also achieved further operating margin expansion compared to the same period last year.

The Engineered Solutions division experienced good organic growth, buoyed by strong demand across US operations.

That division's operating margin slightly exceeded that of the same period last year.

Galvanizing Services meanwhile saw good organic growth, with a significant increase in US production volumes, partially offset by lower volumes in the UK.

However, the Roads and Security division recorded lower results compared to 2023, primarily due to decreased customer demand for US off-grid solar products, following a very strong prior period.

Despite that, the overall market for sustainable infrastructure remained strong, providing positive long-term growth prospects.

The integration of recent US acquisitions - United Fiberglass, Capital Steel, and FM Stainless - was progressing well, with all businesses performing at or above expectations.

Hill & Smith said its merger and acquisition pipeline remained promising, adding that its balance sheet continued to be robust, supporting both organic and inorganic growth opportunities.

Looking ahead, Hill & Smith said it expected full-year 2024 operating profit to be slightly ahead of the top end of analyst expectations.

The company said it remained optimistic about its medium to long-term outlook, driven by strong market growth drivers for sustainable infrastructure.

Hill & Smith planned to announce its interim results for the six months ending 30 June on 8 August.

At 1125 BST, shares in Hill & Smith were up 2.62% at 2,009.38p.

Reporting by Josh White for Sharecast.com.