Nexus builds up solid growth in first half

Housebuilding and commercial services provider Nexus Infrastructure issued its interim results for the six months ended 31 March on Wednesday, reporting a 3.8% increase in group revenue year-on-year, to £62.9m.

The AIM-traded company said its operating profit was up 14.6% to £3.5m, while its profit before tax rose 15.3% to £3.4m.

Its group order book increased 30% to £234.1m, consisting of an 18% rise to £118.4m at Tamdown and a 44% improvement to £115.7m at TriConnex.

Looking at the divisions, Nexus said revenues at Tamdown were up 2.4% to £47.9m, with a gross margin for the period of 16.3%, rising from 15.9% and in line with margins recorded in the preceding financial years.

Tamdown’s operating margin increased 110 basis points to 5.2%, while its operating profit rose 30.4% to £2.5m.

At TriConnex, revenues were ahead 8.4% at £15.0m, with a gross margin for the period up 20 basis points to 34.1%.

Operating margin at TriConnex was 20 basis points higher at 12.9%.

Nexus also claimed to have a “strong” balance sheet, seeing 38.5% growth in net assets to £18.3m as at 31 March, with net cash slipping to £7.4m from £10.3m.

It declared a 4.8% increase in its interim dividend to 2.2p per share.

“We are reporting revenues and profits ahead of H1 last year and a current order book of £234.1m, which positions the group well for future growth,” said chief executive Mike Morris.

“Our recent trading statement identified some industry-driven timing issues from within the TriConnex business, which we are addressing.”

Morris said the underlying demand factors in UK housebuilding were still “strong”, adding that Nexus commanded an established market position, from which it would continue to pursue its growth strategy.

“Against this background, the board is optimistic on the outlook for the business.”