Hargreaves Services lifts forecasts amid strength at German venture

3rd May 2022 13:07

(Sharecast News) - Industrial and property service provider Hargreaves Services hiked its expectations further on Tuesday, due to "continuing strong performance" at its German joint venture Hargreaves Raw Materials Services (HRMS).

The AIM-traded firm said commodity prices, specifically pig iron and zinc, were still having a positive benefit on the results of HRMS and its subsidiary, DK Recycling und Roheisen.

It said HRMS management was "confident" that the venture had sufficient visibility for the rest of the current financial year to expect its contribution to Hargreaves' results to increase by around £5m after tax from prior consensus estimates.

Additionally, the board said it expected some benefit to fall into the first quarter of the 2023 financial year, resulting in an increase of approximately £1.5m after tax against consensus estimates.

It said it remained difficult to predict how long the favourable market conditions would prevail, with both the German management team and the board "cautious" about the medium-term sustainability of the positive trading conditions.

The rest of the group's businesses were trading in line with market expectations, the directors added.

"Clearly current market conditions are extremely favourable, and the board is impressed with the way in which the HRMS team is successfully navigating the opportunities that the market is presenting," said Hargreaves Services' chairman Roger McDowell.

At 1154 BST, shares in Hargreaves Services were up 1.35% at 600p.