Hill & Smith increases its 2016 full year dividend by 28%

DividendMax Ltd.

Hill & Smith increases its 2016 full year dividend by 28%

Key points:

Record revenue and underlying earnings performance

Improved returns driven by strong end markets and active portfolio management:

- Underlying operating margin 13.1%, up 110bps on prior year

- Return on invested capital increased to 19% (2015: 18%)

Underlying profit before taxation up 28% to £68.0m:

- Roads continued to benefit from the UK Road Investment Strategy. International operations gaining traction

- Non-US Pipe Supports restructuring complete, ahead of planned timing and cost

- Galvanizing strong performance in the UK and US, France better than expected

Five acquisitions completed during the year to extend and complement the product offer

Another strong cash generation performance with net debt at £112.0m (2015: £91.5m), after funding £37.4m of acquisitions expenditure

Proposed 32% increase in final dividend of 17.9p giving a full year dividend of 26.4p, up 28% and the fourteenth successive year of increases

Derek Muir, Chief Executive, said:

"Hill & Smith has delivered its best ever trading performance in 2016 with infrastructure spending in our key UK and US markets remaining strong.

"Our performance continues to be underpinned by our tried and tested strategy of international diversity together with the leading positions our businesses hold in their respective markets. Rising infrastructure investment, together with our focus on active portfolio management to drive shareholder value, resulted in record returns.

"Overall, despite political and macro-economic uncertainties, 2017 is again expected to be a year of progress."

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