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PFI disposals help Sweett

23 Nov 12 Cost management consultant Sweett has reported a 4% rise in first-half revenues and turned around last year’s losses, aided by the sale of PFI assets.

Revenues for the six months ending 30 September reached £37.7m, up from £36.1m for the same period last year. A pre-tax profit of £1.6m was posted this time after a £200,000 loss last time.

Chairman Michael Henderson said: "The improved trading performance was in-line with management's expectations. The disposal of our investments in the Plymouth LIFT and Inverclyde Schools PFI projects generated £1.2m of the profit reported for the period. This programme of disposals is designed to release funds to reduce net debt and to reinvest in our core business operations.  

"In Europe we continue to benefit from the restructuring actions completed last year, whilst our investments in the energy and infrastructure sectors have resulted in a number of major commissions.

"We have refocused our Middle East business and have returned to profitability. The group's main target growth market remains Asia Pacific although we are seeing a slowdown in China due to the slowing economy. Diversifying our service offering and sector expertise and cross-selling opportunities throughout the whole of the region is, however, starting to provide benefits. In Australia we are re-aligning our business to the more vibrant private sector, which includes direct investors from China.

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The £92m order book comes 40% from Europe, 54% from Asia Pacific and 6% from the Middle East, Africa and India.

Mr Henderson added: "Although net debt increased from the year end due to an increase in receivables, particularly in China, we have kept well within our banking covenants.

"We are focused on operating within our banking arrangements with further benefits from PFI disposals. The first half performance, successful entry into new sectors, forward order book and our continuing PFI/PPP asset disposal programme point to a stabilisation of the group's fortunes and improving medium term prospects."

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