Renew Holdings: Yorkshire-based engineering services firm set for record profits
Yorkshire-based engineering services group Renew Holdings has said it expects to achieve record revenue and profits for the year.
In a trading update for the year ended September 30, Renew said it expects to report trading in line with market consensus, which currently holds at adjusted revenue of around £1.2bn and adjusted operating profit of £77.7m.
The firm said the record figures reflect “the resilience of the group’s operating model and the quality of its increasingly diversified end-market exposure”.
Leeds-based Renew provides engineering services designed to maintain essential infrastructure including rail and energy.
The firm said that throughout the year, it had “continued to focus on the important markets of Water and Energy”.
The period also saw the company build on its offering in the markets through the acquisitions of Emerald Power, Edwards Diving Services, PWR-X and Electricity Distribution Engineering Services.
Renew said in its latest statement:”These acquisitions are integrating well and the Board expects to continue to expand in these markets both organically and through targeted, earnings-enhancing acquisitions.”
The company said that its balance sheet “remains strong”, with a net cash position ahead of market expectations of £6.3m.
Renew said this came as a consequence of its receiving a one-off insurance payment of around £6.9m relating to the settlement of historic claims.
The firm is set to release its results for the period on Tuesday, November 24.
In June a subsidiary of Renew Holdings announced that it had purchased Wales-based Edwards Diving Services (EDS) for up to £13m.
EDS is a provider of specialist marine and civil engineering services to the water industry.
The firm was purchased by Renew’s wholly-owned subsidiary , Envolve Infrastructure.
Speaking on the deal, Paul Scott, CEO of Renew, said: "This acquisition expands our services into the exciting specialist water and environmental sectors, bolstering our existing, well-established position in the regulated water maintenance and renewal market.
"As we move into the second year of the AMP8 control period, we are increasingly well placed to capitalise on the significant level of investment, underpinned by a wider environmental protection focus on waterways and marine investment.
"I am delighted to welcome the highly regarded EDS team into the Renew family and I look forward to updating the market on the further progress in due course."
An initial £10m is being paid for the business, with an additional payment of up to £3m conditional upon the vendors remaining with the business for an agreed period and specific profit targets being achieved.
Renew said in June that the deal would be “immediately earnings enhancing”, adding that the group was also evaluating further acquisitions.