Hargreaves Services (LSE:HSP) expects to deliver revenue ahead of market expectations and profit before tax in line with consensus forecasts for the year ended 31 May 2026, supported by improved profitability across its Services division, Hargreaves Land business and German joint venture HRMS.
Services Division Benefits from Infrastructure and Energy Demand
The Services division continued to perform strongly during the year, benefiting from robust activity in connectivity, clean energy and environmental markets. The business also maintained its involvement in major UK infrastructure projects, including HS2 and Sizewell C, while securing its first contract linked to the Lower Thames Crossing development.
Results were further supported by a £7 million one-off profit arising from the settlement of a mining services contract, providing an additional boost to divisional earnings.
Land and German Operations Drive Further Profit Growth
Hargreaves Land is expected to report a significant increase in profitability, aided by the disposal of renewable energy land assets that generated £14 million in net cash proceeds. Additional contributions came from ongoing land sales at the group’s flagship Blindwells development in Scotland.
Meanwhile, German joint venture HRMS is forecast to deliver higher earnings as economic conditions in Germany stabilise. Performance was supported by consistent trading at its steel waste recycling facility, while development of a zinc recycling plant remains on schedule.
The group also finished the year with a strong balance sheet. Following a £20 million return to shareholders funded through asset disposals, Hargreaves reported cash balances of £21.6 million at year-end and remained free of borrowings other than lease-related liabilities.
Positive Fundamentals Support Outlook
The company’s outlook continues to be underpinned by strong financial performance, characterised by earnings growth, healthy cash generation and limited leverage. Technical indicators also remain supportive, with the share price trading above key moving averages and momentum measures remaining positive.
Valuation metrics are viewed favourably due to the company’s relatively low earnings multiple and attractive dividend yield. While management’s outlook reflects continued momentum and a commitment to shareholder returns, investors will continue to monitor execution risks associated with land disposals, renewable energy projects and the development of the zinc recycling facility.
More About Hargreaves Services
Hargreaves Services plc is a diversified industrial group operating across environmental, infrastructure and property markets in the UK and South East Asia. Through its Services division, the company provides materials handling, logistics, mechanical and electrical contracting services, as well as major earthworks solutions.
The group also develops brownfield land through Hargreaves Land and operates HRMS, its German joint venture focused on specialist commodity trading and steel waste recycling activities.
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