Fountains reported improved interim profits before the costs of its bid talks and a board restructuring.
The vegetation management and forestry services business has an order book is worth £102m, which is slightly down on one year ago but higher than the £96m reported in February 2009. The order book is spread over a number of years. Around £17m of the order book is for 2009 and more than £23m for 2010.
A £5m a year contract with the British Waterways Board has helped to keep the figure high. This contract lasts for three years and can be renewed for another two.
Revenues improved from £20.7m to £21.1m in the six months to March 2009. One-off bid and board change costs were £372,000. There will be more bid costs in the second half.
After those costs the profit fell from £650,000 to £388,000 but there was an underlying improvement. This is a big improvement on the loss in the second half of last year.
The improvement came in the contracting side of the business with the forestry contracting services division making a lower contribution even though revenues grew.
Net cash has improved to £513,000 over the six months to March 2009. There is also £6.1m of overdraft and credit facilities available. The interim dividend has been increased from 1.1p to 1.25p a share.
Management hopes to win some more large contracts in the near future.
Shares in Fountains jumped 9p to 64p each, which values the company at £6.4m. Bid talks, which were announced in November 2008, continue. The share price is below the level it was when the talks were announced. More than one bidder is interested.
© 2021 Aim Micro. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.