Alumasc has published a trading update for the six months ended 31 December 2020, ahead of publication of its half-year results in February 2021.
Thanks to market conditions that remained positive, the Group has registered record profits. For the first six months of the year, revenue increased 11% compared to the prior year, to £45.6 million. Profit before tax also increased significantly, from £2.3 million to £6 million, underpinned by strong performances from all divisions of the business.
While trading in the period includes an element of catch-up demand following the UK's first national lockdown and has benefitted from a range of Government support for the construction industry, the Group has also been successful in winning market share in the UK and abroad.
Additionally, a restructuring exercise provided £2.4 million in annual cost savings, and Levolux continues to respond well to the business's turnaround plan, achieving a profit in each month of the first half of this financial year.
The business entered the second half of the year with good momentum, a healthy forward sales position, and a well-capitalised balance sheet, creating the potential to deliver a strong result for the year. Nevertheless, it remains mindful of the continued economic uncertainties, particularly the risk of disruption to the business and markets in the near term as a result of the on-going pandemic and the establishment of cross-border goods movement procedures following the entry into the Free Trade Agreement with the EU.
Conditions in the company's markets, particularly in the new build housing and RMI sectors, have been very good and are anticipated to remain so in the coming months. The changes to UK Government incentives within the housebuilding industry, notably around the current Help to Buy Scheme being extended beyond 28 February 2021 and Stamp Duty, may affect the final quarter, albeit in ways that are difficult to predict. However the UK's accelerating rollout of vaccines and mass testing, which should provide some counterbalance in our markets, are promising.
Overall, the company describes its results as a most encouraging performance in the first half, with an excellent platform to deliver sustainable shareholder value.
Paul Hooper, CEO, commented: "It is very encouraging to see Alumasc's achievement of a double digit growth in revenues and also a double digit return on sales and H1 has absolutely shown the great potential for the Group. In light of the businesses' momentum and strong cash conversion, a resumption of Alumasc's previous dividend policy is being considered by the Board."