The Courier & Advertiser (Fife Edition)
‘Good progress’ for Havelock
SHARES IN Fife retail and education interiors group Havelock Europa lifted yesterday after the company said it had made “good progress” in identifying new customers.
The f irm, which employs around 400 staff at two sites in Dalgety Bay and Kirkcaldy, said in an update to the markets that trading for the year to December 31 was likely to be in line with expectations.
The company indicated last September that it expected to return to profit for the full 12-month period, despite racking up a £2 million loss in the traditionally slower first half of the year.
Havelock has long-term links with high street giants such as Primark and Marks & Spencer, and has recently made is first foray into the supermarket sector with an unnamed client — a move that is helping to bolster the bottom line.
“The group has made good progress in line with its strategy of widening its customer base, with projects being completed for the first time for a major UK supermarket,” the company told investors yesterday.
“This is a sector of the market which the group has been actively pursuing, and it represents an important step in further expanding its coverage of the retail market.
“Encouragingly, there is an increase in tender activity in both the UK and overseas, and the benefits of additional business should be reflected in order intake during 2014.”
Havelock said it core educational interiors business — which provides furniture for schools, colleges and universities — continued to suffer from slack demand, but there were signs of improvement in the sector in the pipeline.
The firm is also targeting the student accommodation sector, which has seen strong growth in recent years.
“In the educational sector, order intake remained subdued, and as a result revenue from this sector is likely to fall in 2014,” the company warned. “However, recent announcements of programmes and discussions with principal building contractor customers give confidence of increased orders in coming months leading to increased revenue in the future.
“In addition, the group is achieving success in securing orders for student accommodation.
“The impact of these activities will occur in 2015 and therefore the longerterm outlook for the educational sector is encouraging, and it will continue to be a major part of the group’s activity.”
Havelock. led by chief executive Eric Prescott, said the £1.1 million sale of Fontana House — the home of former subsidiary Showcard Print — in November helped to push down the firm’s debt burden and allowed it to concentrate on developing new business opportunities.
“The sale of surplus property which was announced in November 2013, together with stringent control of working capital, resulted in group net debt falling below £0.5m at the financial year end,” it said.
“This was achieved alongside capital investment which exceeded £1m in the year. Substantial reduction in debt has been a major part of the group’s strategy over recent years and, having succeeded, the group can now focus entirely on developing and growing its core business.”
Shares in Havelock closed up 5.04% at 18.25p.