In a trading statement covering the period 1 July to 15 November 2011, ahead of its AGM which will be held later today, ISG said it continued “to benefit from our 80% exposure to the private sector and our strategic decision to expand into retail and overseas in recent years”.
Its order book for delivery in the current period increased by 7% to £573m (October 2010: £533m), with the total order book standing at £709m (October 2010: £690m).
ISG's net cash fell to £25m (December 2010: £37m).
The firm's said its London Fit Out business, “despite a competitive market, has maintained its revenues and is still securing a steady pipeline of smaller sized projects, helped by our focus on quality of delivery. We continue to expand and improve our reputation and offer in the technology, high-end residential and hotel sectors.”
It added: “Our Retail Fit Out and Food Retail businesses have maintained their market leading positions and are receiving strong allocations under their client frameworks for the current financial year. In the period we have successfully added new framework relationships with the John Lewis Partnership, Nationwide Building Society and Everything Everywhere.”
ISG it expects its UK Construction business to maintain revenues in line with last year, but at lower margins.
“The increased allocations from the London Organising Committee of the Olympic and Paralympic Games (LOCOG) together with other positive trends in our London business will benefit us in the second half,” the firm said. “Regional disparities continue to widen with the South East and London enjoying a markedly stronger flow of work opportunities that will allow us to offset the significant negative problems we previously identified in the South West.
“As a consequence of this disparity we have also downsized our North East business and discontinued our Affordable Housing activity in the South West. We expect the remainder of the South West business to return to profitable trading by the year end.”
ISG continues to expand abroad, and recently completed the acquisition of Alpha International, a Paris-based retail fit out company.
In Asia, it has now integrated Realys, the Shanghai based design-led project management company acquired in April 2011.
The firm said the Middle East “has had a slower start to the year” due partly to delay in the completion of base buildings in Abu Dhabi where it is involved in the first five fit outs international clients on Sowwah Island.
Summarising, ISG said it remains “confident of meeting the Board's expectations for the full year in respect of underlying profits, albeit with a further shift in profit weighting towards the second half.
“We continue to pursue growth opportunities both organically and by acquisition particularly overseas and to broaden our service offering to key international clients.”
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