Sureserve unveils strong trading update powered by growing order book
Sureserve has posted a bullish trading update, revealing its order book has bounced sixteen per cent over the past 12 months, rising to £585m.
The social housing energy services group is expected to publish full-year results next January in line with the board positive expectations – covering its trading for the 12 months up to September 2022.
Its net cash balance (excluding lease liabilities) was in excess of £23m last month, up from £16.5m 12-months prior, with the group’s £15m revolving credit facility remaining undrawn.
The energy solutions specialist has snapped a bevy of deals this year, signing a 10-year £20m agreement with Tower Hamlets Homes to provide domestic gas services for its council houses in February.
It also snapped up CorEnergy last month in a £7.5m deal and Vinshire Gas Limited last January.
The group’s two businesses, Sureserve Fire and Electrical Limited and Precision Lift Services Limited, also remain in the shop window.
Chief executive Peter Smith said: “The results for the year confirm a good trading performance and demonstrate Sureserve’s resilient business model, which is to provide energy services to the Social Housing sector. Our £585m order book provides good visibility of future earnings and our strong cash generation sets us up well to deliver on our growth targets.”
Investment group Peel Hunt has maintained its buy stance, with a target price of 120p per share.
It is forecasting an operating profit of 18 per cent to £17.2m, with a 5.8 per cent margin, for the full-year.
Analyst Andrew Nussey said: “Sureserve continues to perform well given the essential nature of its energy services to robust long-term markets (supported by government spend). Organically, we see the potential to deliver high single-digit growth, but with the added scope to utilise the balance sheet for accretive mergers and acquisitions.”
Despite the encouraging update, shares are down 3.13 per cent on the FTSE AIM All-Share at close of play today.