Renew revenue, earnings rise as it continues to expand

Infrastructure engineering services company Renew reported a 27.5% improvement in group revenue in its final results on Thursday, to £791m.

The AIM-traded firm said its adjusted operating profit was up 29.3% for the 12 months ended 30 September to £51.2m, while operating profit was 25.2% firmer at £41.1m.

Its adjusted operating margin was ahead 10 basis points at 6.5%, while its profit before tax was 26.9% firmer at £40.8m.

Adjusted earnings per share grew by 22.5% to 50.5p, as the board declared a 34.1% rise in the final dividend, to 11.17p per share.

On the operational front, Renew noted the acquisition of Browne for £29.5m in March added “material scale” to its water business, in line with its strategic objectives.

The company said it added Thames Water, Affinity Water and Southern Water as new clients during the period, while the acquisition of REL in May added a “unique skillset” with a view to supporting the government's rail decarbonisation programme.

Adjusted profit in engineering services improved to £51.5m frim £40.8m, while “good progress” was made against its quantitative sustainability targets outlined in its interim results in May.

Looking ahead, Renew said its positive trading momentum was carried into the new financial year, with a “strong” forward order book underpinning confidence in its further progress in 2022.

The board said it was “confident” in the company’s future prospects, and was “well-positioned” to capitalise on its strengths to target new opportunities in attractive markets.

“2021 was another record year for the group and I am pleased with the progress that has been made across all divisions,” said chief executive officer Paul Scott.

“The essential nature of our work combined with the resilience of our low-risk, high-quality operating model has been a key driver for growth, as we continued to operate through the numerous lockdown and tiering scenarios experienced during the year.

“The two acquisitions that we completed have strengthened our offering in water and rail and both are delivering to plan.”

Scott said the company had carried forward its trading momentum into the new financial year, with a “strong” forward order book.

“As we look further ahead, we are committed to building on our strengths to target new opportunities in attractive markets where we have the skillset to deliver mission-critical engineering infrastructure solutions for a sustainable future.”

At 1235 GMT, shares in Renew Holdings were up 5.42% at 845.46p.