Mountfield Group Plc (LON:MOGP), the AIM listed commercial flooring and specialist construction services company announced today its half-yearly report to 30 June 2017.
· Net profit before tax for the first half of 2017 was £305k (2016: £316k).
· The Board expects a markedly improved performance from the Group for 2017 over 2016.
· Connaught Access Flooring Limited (“CAF” or “Connaught”) has won over £6m worth of contracts since the beginning of 2017.
· The Board anticipates that CAF is about to win another significant contract – one with an initial value of c£4m.
· Mountfield Building Group Limited (“MBG”) is in negotiation over a number of valuable opportunities and its performance in the second half of the year is expected to be substantially stronger.
Andy Collins – Mountfield Group Plc CEO said: “The first half of 2017 saw exciting developments for both Companies.
CAF has successfully tendered for £6m of new business since 1 January 2017 and expects shortly to confirm the gaining of a new, substantial contract. Together, this demonstrates the progress it has made in establishing itself as one of the few top-tier commercial flooring suppliers and installers. It also underlines its status as one of the very few commercial flooring companies that major construction companies and developers will trust when choosing a specialist able to take on a complex and valuable project, and one that has the proven ability to produce a very high quality product within a tight time schedule.
This level of turnover (the aggregate won in the first six months is more than it has previously won in a twelve month period) will ensure a strong performance during the current year and provide it with a strong start for 2018.
With a number of exciting opportunities under negotiation with both existing and new clients, the Board expects MBG to perform strongly in the second half of the year in terms of the profitable delivery of current projects and in securing significant new ones for completion in 2018 in line with its recently adopted business criteria and strategy.”
Chairman and CEO’s Statement
The first half of 2017 saw the Group generate a net profit before tax of £305k a figure that was in line with that earned in the corresponding period of 2016 (£316k).
The Board is very pleased with the progress that the Group has made in the first half of 2017 and expects a stronger performance in the second half of the year over that achieved in 2016 and that, as a result, the full year figures will reflect a marked improvement compared with those for the 2016 financial year.
CAF has had an extremely satisfactory first half and achievement is reflected in the net profit of £408k earned during the first half (2016: £397k) but more particularly in the new business it has acquired to be undertaken during 2017-8. The first three of these contracts had already been announced and of them, two were separate contract stages in respect of a single property that were announced on 7 March 2017 (value of £1.2m) and on 29 August 2017 with a value of £1.5m to be undertaken in the 12 months from October 2017. In addition, the Company was awarded a contract valued at £2.5m (announced on 7 March 2017) for completion during 2017.
In addition to these contracts, the Board is confident that CAF is about to be awarded a particularly significant contract – one with an initial value of circa £4m – to supply and install flooring at another major office development in the City of London.
The Board expects that the Company’s successes in 2017 are unlikely to be limited to these contracts. The market remains strong in terms of tender activity and CAF expects to secure additional works including some to be undertaken in 2018.
MBG’s levels of activity and involvement in tendering and contract negotiations in the first half of the year were not reflected in its performance and in particular in the net profit of £44k (2016: £71k). The announcement on 6 September of it having won contracts for a single client with an aggregate value of approximately £750k and another where the client has provided MBG with a letter of intent enabling it to procure essential materials in advance of the commencement of a contract with a value in excess of £1m. These contracts are expected by the Board to be followed by a series of other contract wins during the remaining months of 2017.
The Board anticipates the Group performing well in the second half of the year and also CAF and MBG securing further business that will ensure a strong backbone for 2018.