The board of directors of Northern Bear plc (the “Board”) is pleased to provide an update on trading for the six month period ended 30 September 2019 (“H1 FY20”) for the Company and its subsidiaries (together the “Group”).
In the Company’s preliminary results for the year ended 31 March 2019, announced on 15 July 2019, it was noted that the Group had experienced a slow first financial quarter ended 30 June 2019 (“Q1”) due to a number of contract delays arising from matters which were beyond our control. However, with such contracts having commenced, trading was expected to be stronger in the second quarter. We also stated at that time that we had a strong end to the last financial year as our Roofing Division completed a number of major contracts in March 2019 and we held a high level of committed orders.
The Board is pleased to confirm that trading in the second quarter ended 30 September 2019 (“Q2”) has been much stronger than Q1, and ahead of the corresponding period last year, with the majority of the above mentioned new contracts having commenced and I am pleased to report excellent results across the whole Group since July.
When we reported the interim results for the six months to 30 September 2018 (“H1 FY19”), we stated that these results were considered exceptional. Whilst we are greatly encouraged by performance in Q2, the slower trading in Q1 will mean that reported results for H1 FY20 will be below those for H1 FY19. The Board’s current expectation is that operating profit, stated before amortisation and other adjustments (in the format used in our FY19 results), is expected to be in the range of £1.3m to £1.4m (H1 FY19: £1.7m).
This estimate is subject to finalisation of our unaudited interim results for H1 FY20. The interim results will also include adjustments for the first time adoption of IFRS 16 “Leases”, which requires operating leases to be recorded on the balance sheet with right-of-use assets representing the right to use the underlying asset and lease liabilities representing the obligation to make lease payments.
The Group continues to hold a significant order book and we expect the strong momentum in Q2 to continue into the second half of the financial year. We consider the outlook for the current financial year to remain positive, despite continued uncertainty in the macro-economic environment, and are hopeful of reporting another strong set of full year results.