Severfield annual loss widens as sales stall in challenging markets

Severfield PLC on Tuesday declared no dividend as competitive pricing, delays to project awards and lower activity in core markets saw losses mount.

The North Yorkshire, England-based maker of structural steel in the UK and India said its net loss widened to £39.9 million in the financial year ended March 28 from £17.5 million the year prior.

Losses per share totalled 12.0 pence, compared to 4.7p a year ago.

Underlying pretax profit dropped 42% to £10.5 million from £18.1 million a year ago, which Severfield said was in line with market expectations.

Revenue edged up 0.8% to £454.3 million from £450.9 million, with a ‘strong’ second half despite a ‘challenging’ market backdrop.

‘FY26 was a challenging year for Severfield, with profitability impacted by competitive pricing, delays to project awards, and lower activity in parts of our core markets,’ commented Severfield Chief Executive Paul McNerney.

Shares in Severfield were flat at 27.80 pence each in London on Tuesday.

Consistent with the prior year, no final dividend was proposed, reflecting a priority to ‘maintain balance sheet strength and financial flexibility’. Severfield intends to reinstate payments, subject to sustainable cash generation and its financial framework.

Looking ahead, Severfield expects underlying pretax profit for financial 2027 to be in line with previous guidance of £12 million to £15 million.

‘FY27 is expected to be a transition year, with first half profitability continuing to reflect lower?margin work secured in a tighter pricing environment, whilst several larger and higher-value projects are expected to commence later in FY27,’ the firm said.

In addition, Severfield set out medium-term ambitions for revenue of £500 million to £550 million, a sustainable operating margin of 7% to 8%, underlying pretax profit of £40 million to £50 million (including £10 million from India), a return on capital employed of more than 15%, leverage of 1.0x to 1.5x and cash conversion in excess of 90%.

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