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WYG says Brexit has caused project delays in construction

Snapshot

WYG manages civil projects across the public and private sectors

WYG

Quick facts: WYG PLC

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AIM:WYG
Market: AIM
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  • Brexit uncertainty has affected business decisions

  • Demand for consultancy services in the UK between January and March subdued in what normally is a buoyant period

  • Revenues in the international development division are ahead of forecasts, but margins here are lower than the UK

 

What it does

WYG PLC (LON:WYG) manages civil projects across the public and private sectors including town and transport planning, urban regeneration, higher education institutions, affordable housing schemes and community development.

How is it doing

Brexit uncertainty means business is tough currently. Operating profits for the year to 31 March will be “materially below current market expectations” said an update in February.

Net debt is set be around £10.0mln at the year-end – in line with estimates, although it is looking at ways to bring this down and is talking to its banks over the covenants on its debt.

In the half year to September, revenue was broadly stable at £75.3mln (£76.2mln).

Operating profits at the half way point edged up to £1.1mln (H1 17: £1.0mln) thugh the group highlighted Brexit as a potential problem.

The UK accounts for more than 70% of revenues.

What the boss says

“The headwind from political uncertainty is affecting many businesses' willingness to commit to major new projects,” said chief executive Douglas McCormick.

“This has particularly affected the construction sector which underpins much of our business in the UK.”

Longer term

WYG is investing in moving its operations to cloud-based systems and digital technologies.

“Our strategy of developing a simpler, more robust platform and driving efficiencies continues.

“I am confident that the actions we are taking will improve the longer-term prospects of the business and we will look to accelerate these actions to mitigate against the impact of an unusually difficult final quarter in the current uncertain macro-economic environment.”

 

 

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