Hargreaves Services describes 'strong' recent trading

27th Oct 2022 14:22

(Sharecast News) - Hargreaves Services said in an update on Thursday that all three of its business sectors - services, Hargreaves Land and HRMS - were trading in line with its expectations.

The AIM-traded firm, which was holding its annual general meeting, said the services business had a strong start to the year, despite energy pricing and inflationary pressures.

Chairman Roger McDowell said more than 50 framework or term contracts with blue-chip clients provided "excellent" revenue visibility and resilience, to weather current economic turbulence.

"Hargreaves Land has completed another transaction at Blindwells," McDowell added.

"The sale of 4.5 acres to Ogilvie Homes generated revenue of £3.4m and continues to demonstrate the recurrent nature of regular transactions at this site.

"A further 20-acre plot is expected to be exchanged later this financial year and initial marketing of a new 7.9-acre plot is generating strong housebuilder interest."

The chairman said the first four months of the financial year saw a "strong" trading performance within the German joint venture, HRMS.

"Uncertainty within German industrial markets and short visibility on trading means that it remains unclear how long current conditions will persist.

"The balance sheet remains strong, free from bank debt and third-party security."

As at 30 September, Hargreaves' cash balances stood at about £19m, with leasing debt at £27m.

"The board remains confident in delivering full year results in line with market expectations," Roger McDowell said.

At 1403 BST, shares in Hargreaves Services were up 11.71% at 391p.

Reporting by Josh White for Sharecast.com.