Covid? What Covid? That seems to be the message from Renew as it filed its annual financial results showing profit and turnover reaching a new high.
Revenue was up more than 3% to £620.4m (2019: £600.6m) and pre-tax profit was up 19% to £32.1m (2019: £27.0m).
Growth was achieved thanks to the £38m acquisition of highway maintenance contractor Carnell in January.
During the year Renew also returned to a net cash position – £300k from £10.2m net debt at the start of the year.
The order book at 30th September 2020 stood at £692m (2019: £581m). Renew’s businesses include AmcoGiffen, Seymour Civil Engineering, VHE Construction and Walter Lilly.
As previously reported, Renew’s services were much in demand when storms hit in February.
And approximately 80% of Renew’s activities continued during heights of the Covid-19 crisis as they were deemed critical works.
“Since then, the majority of operations have returned to levels similar to those experienced prior to the pandemic across all of our markets, with the exception of our nuclear operations at Sellafield where we do not expect the site to be fully operational until April 2021,” said chief executive Paul Scott.
He said: “The pandemic has demonstrated like never before the core defensive strengths and resilience of our high quality, low risk, value-accretive business model in providing 24/7 specialist engineering services to our clients in complex, challenging and regulated environments.
“Thanks to our differentiated and cash generative earnings model, we delivered a record trading performance, with a solid margin, strong cash flow and continued EPS growth. We continue to focus on bolstering our performance with highly selective, value enhancing acquisitions to strengthen our presence in key markets.”
He continued: “Following the acquisition of Carnell earlier in the year, which facilitated our entry into the strategic highways network, I am very pleased with its positive contribution to the group’s results.
“The growth prospects within our industry are highly attractive, driven by non-discretionary government spending in relation to UK infrastructure, a greater focus on sustainability and renewable energy, population growth, technological innovation driving a shift towards digital transport networks and smart cities, along with increased regulation. Renew’s businesses operate in markets underpinned by sustainable, long-term structural growth dynamics and committed regulatory spend.”
“Trading in the new financial year has started well and we are ideally positioned to play a significant role in the long-term recovery opportunities that will emerge across UK infrastructure, a sector that will play an important role in rebuilding the economy over the next decade and beyond.”