Services group reports near €2m profits drop

SERVICES group Siteserv had a near €2m drop in profits during the first half of its current financial year, but has said that a good performance in its British operations have offset a poorer showing here.

Yesterday, the company reported a pre-tax profit of €541,000 for the six months to the end of October — down from a profit of €2.3m for the same period last year. First half revenue, however, was up by 3% — on a year-on-year basis — at €84.5m, on the back of new contract wins both here and in Britain. Operating profit, however, fell from €6m to €4.6m.

The company’s management said that current trading remains in line with its expectations, but added that its trading outlook for the full-year — to the end of April — “continues to be challenging”.

Chief executive Brian Harvey added that management remains focused on “driving organic growth and geographically diversifying our revenue”.

Any strength in Siteserv’s first half figures was driven by its British operations — which enjoyed a near €7m year-on-year rise in revenue to €47.3m. The Irish operations saw a €4m fall to €37.2m.

The British division currently accounts for 56% of Siteserv’s total group revenue.

The group said it has a strong pipeline of long-term revenue — well over €200m — up to the first quarter of 2014 and management added that these streams “will continue to play a key role in offsetting the impact of economic volatility on the group’s performance”.

“Our objective is to continue to diversify our revenue by geography and sector, and generate free cash flow to drive organic growth and — over the medium term — for debt reduction,” Mr Harvey added.

Siteserv’s net debt — as of the end of October — amounted to €148.8m; up from €144.5m at the same stage last year. The company added that the outlook for its access division in Ireland (which looks after such services as fencing and scaffolding) “remains difficult” and will see continuing cost reduction, operational efficiencies and the sale of surplus stock.