Plumbing and heating merchant group BSS Group has seen revenue holding up well for the first 18 weeks of the second half of the financial year, according to an interim management statement.
Despite challenging trading conditions, revenue in the period October 1 2008 to January 31 2009 remains resilient. Total revenue for the 18 weeks of £437.2m was 4.4% up on last year on an equivalent working day basis. Like for like revenue, excluding the impact of new branches and acquisitions was 0.2% below last year (against 3.3% like for like growth in the six months to 30 September 2008).
The Industrial Division saw like for like growth in revenue of 2.8%, though deflation on copper and steel prices had an impact here.
The group expects there to be a slowdown in private sector non residential new build business later in 2009 but public sector and core repairs and maintenance (‘R & M’) activity is anticipated to remain resilient.
The Domestic Division – which includes PTS – has shown a resilient performance in the period, despite the economic slowdown and a tightening in the R & M market. Total revenue including new branches – 14 opened in the period, 25 opened year to date – was up 4.6% on last year on an equivalent working day basis with like for like revenue 1.1% down on last year.
F & P Wholesale has maintained momentum in the second half.
Revenue in the Specialist Division was 8.6% up on last year on an equivalent trading day basis. Excluding Birchwood Products, acquired on 1 March 2008, like for like revenue was 1.7% down on last year.
The outlook for the Group will be more challenging in 2009 but BSS is positioned to trade through a recessionary market. The core business is primarily focused on the R & M market and a significant proportion of revenue is generated from long term contracts. Management continue to take action to reduce the cost base with year end headcount expected to be 5% below peak levels, excluding new branches.
The Group’s financial position remains strong, net debt to EBITDA at 30 September 2008 was 1.3 times, and there have been no material events or transactions affecting the Group in the period.
The Board presently expects the financial position of the Group to strengthen in the current year and profits to be in line with last year.