James Halstead flags record full-year record profits

31st Jul 2024 12:25

(Sharecast News) - Commercial flooring manufacturer and distributor James Halstead said in an update on Wednesday that it expected to report record profit before tax for the year ended 30 June, in line with upwardly-revised market expectations.

The AIM-traded company attributed the strong performance to the improved profitability seen in the first half continuing into the second half.

It said it had experienced robust demand in its core segment of resilient sheet flooring, particularly within the healthcare, education, and institutional sectors.

Regional sales in the Middle East and the Americas were notably strong, although the performance of products aimed at the domestic sector was weaker in key markets such as the UK and Europe.

Despite challenges in some areas, James Halstead said it bolstered its margins through gains in product mix, cost control, and lower raw material prices.

However, energy costs, especially electricity, remained elevated.

The firm noted that while raw material costs had decreased, they were still about 50% higher than in June 2020.

Operational challenges included increased delivery times and costs due to shipping disruptions in the Red Sea, which particularly affected the Asia-Pacific markets.

In response, the company said it had increased stock levels in its overseas markets to mitigate those delays.

Overall, James Halstead said it remained confident in its financial position, expecting to surpass last year's figures for profit, cash levels, and dividend.

The company said it would release its full-year results on 1 October.

At 1201 BST, shares in James Halstead were up 5.78% at 182.47p.

Reporting by Josh White for Sharecast.com.