Provider of infrastructure resilience solutions posted an 11% rise in underlying operating profit to £73.5 million
LONDON: Hill & Smith PLC (HILS.L) reported record first-half results on Wednesday, buoyed by robust demand in its US infrastructure markets and improved profitability in the UK, prompting the company to announce a £100 million share buyback.
“We have delivered another record performance in the first half, driven by a strong performance in our larger US platform businesses and better profitability in the UK,” CEO Rutger Helbing said. “Our second half outlook remains positive, underpinned by continued growth in our US end markets.”
The provider of infrastructure resilience solutions posted an 11% rise in underlying operating profit to £73.5 million on a constant currency basis for the six months ended June 30, while revenue rose 4% to £431.6 million. Statutory profit before tax climbed 10% to £63.5 million.
The Group cited continued strength in its US Engineered Solutions and Galvanizing Services divisions, with record order books supporting growth. In contrast, UK markets remained subdued, particularly in road infrastructure.
Operating margins expanded by 80 basis points to 17.0%, while return on invested capital (ROIC) improved to 25.7%, up 320 bps year-on-year. Underlying cash conversion stood at 85%, and covenant leverage dropped to 0.1 times, giving the Group flexibility for growth and shareholder returns.
Hill & Smith declared an interim dividend of 18.0 pence per share, up 9%, and announced the divestment of two small, non-core loss-making businesses in Q1. The company also confirmed an active M&A pipeline focused on bolt-on acquisitions in its US platform businesses.
The Group expects full-year underlying operating profit to be in line with market expectations and remains confident in its medium-term growth outlook, citing structural tailwinds in infrastructure and the built environment.
Helbing added, “Given the strength of the balance sheet and cash generation, we have the capacity to return capital to shareholders without compromising our growth priorities.”