Severfield plc (LSE:SFR) said trading at the beginning of FY27 has been in line with expectations, with the company maintaining guidance for underlying pre-tax profit of between £12 million and £15 million. A series of new contract wins, particularly in the data centre sector across the UK, Germany and Sweden, has increased the group’s UK and European order book to £534 million, providing strong revenue visibility for the current financial year and beyond.
The company said Continental Europe now represents almost one-third of its regional order book, supported by an increasing proportion of higher-quality projects that are expected to deliver stronger margins over time. Management reiterated that FY27 will remain a transition year, with first-half profitability continuing to be affected by legacy lower-margin contracts before newer, higher-margin projects make a more significant contribution during FY28.
Severfield also reported a positive start to the year for its Indian joint venture, JSSL, which increased both revenue and production while expanding its order book to £327 million. Growth has been driven by additional data centre projects and repeat business linked to JSW’s investment programmes. Management believes the strengthening pipeline in India will allow JSSL to make an increasingly important contribution to group earnings and profitability over the medium term ahead of the company’s half-year results in November.
Although recent financial performance has been impacted by net losses and weaker profitability, the company’s operational outlook has improved thanks to a growing order book and increasing exposure to higher-margin work. Technical indicators also remain supportive, with the shares trading above key moving averages and maintaining positive momentum. However, valuation remains constrained while the company continues to report losses, and the absence of a dividend yield provides limited additional support.
About Severfield
Severfield plc is one of Europe’s leading structural steel specialists, providing the design, fabrication and construction of large-scale steel structures across the UK and continental Europe. The company operates six fabrication facilities with a combined annual production capacity of approximately 150,000 tonnes and employs around 1,800 people. Its projects span a range of sectors, including data centres, commercial developments and major infrastructure.
The group also has a significant presence in India through its joint venture with JSW Steel, JSSL, which operates two fabrication facilities and is expected to increase annual production capacity to more than 224,000 tonnes by the end of FY27. This international footprint supports Severfield’s long-term strategy of expanding its presence in high-growth markets while delivering increasingly complex structural steel projects.
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