Thursday, February 25, 2016

News: Funding gives Horbury Group firm foundation for growth

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Rotherham construction group, Horbury, is reporting a strong order book and has already secured £14.9m of orders for the 2016/17 financial year.

From its headquarters in the Moorgate area, the group combines a number of subsidiaries that specialise in areas including joinery, ceilings, dry lining, health and safety training, and recruitment.

Horbury has published its first financial results since securing £2.5m from the Business Growth Fund (BGF) and a £6m funding package from HSBC. The finance secured in 2014 was to support a move to tender for larger, and a greater quantity of, projects and significantly increase its workforce.

For the year to May 31 2015, the group reported a turnover of £50.9m, down from the £53.1m in the previous year. This meant that a pre-tax loss of £375,620 was posted for 2015, compared with a profit of £84,046 in 2014. Horbury said it was working in a market where "competition for resource is driving cost inflation."

The report stated: "Whilst Group turnover decreased by £2.2m or 4.1% between 2014 and 2015, this was a result of the board's deliberate strategy of targeting more lucrative contracts with higher gross profits, rather than buying work at lower margins. The successful outcome was an increase in gross profit percentage from 13.2% in 2014 to 14.1% in 2015, with the resulting gross profit being £0.2m higher in 2015 than in 2014."

The report also shows that the BGF - which was established in 2011 to help Britain's growing smaller and medium sized businesses and is backed by Barclays, HSBC, Lloyds, RBS and Standard Chartered - invested again in Horbury with a further £1m in loan notes in June 2015 as well as committing to an additional £1m of funding over the next 12 months to help the group meet its growth aspirations.

Looking ahead, Horbury is reporting a strong order book and that sales are expected to be delivered at gross profit margins above those seen in 2015. It adds: "Orders worth £14.9m have already been secured for 2016/17, which coupled with the continuing improvement in both the economy and construction sector, lead the board to be confident about the group's financial performance going forward."

The Horbury Group, which formed in Sheffield in 1993 as Horbury Building Systems, has gone from strength-to-strength over recent years, increasing its turnover from £1.4m in its first year. Expanding nationwide, the company already has a workforce of 800 people.

Subsidiaries provide internal fit out services including partitioning, ceilings, joinery and flooring to major construction companies including Carillion, Balfour Beatty, Kier, and Shepherd Construction. They have worked on a range of high profile projects including the Manchester Civil Justice Centre and The Co-operative's headquarters in Manchester (pictured), the Queen Elizabeth Hospital in Birmingham and the City Lofts development at St Paul's Place in Sheffield.

Horbury Group website

Images: Horbury Group

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