The recovery at Westminster Group PLC (LON:WSG) continued in the first half of 2019 with sharply reduced losses on revenue that more than doubled.
The supplier of managed services and technology-based security solutions said it was operationally cash positive in the first six months of 2019 and that its sales order intake remained strong during the period, unchanged from a year earlier at £3.9mln.
The order book at the end of June stood at £3.3mln. The group said it has a healthy and active enquiry bank and continues to progress several large-scale project opportunities around the world.
Group revenue rose 117% to £5.6mln from £2.6mln the year before, with a 257% increase in Technology Division sales to £3.1mln from £0.9mln the year before and a 47% hike in Managed Services Division sales to £2.5mln from £1.7mln the previous year.
Both divisions performed ahead of expectations, while passenger numbers at the company’s West Africa airport operations during the first six months of the year were the highest since Westminster commenced operations there, with the trend set to continue judging by July’s performance.
Based on the current order book and the run rate, including the recently acquired Keyguard and Euro Ops businesses, Westminster expects full-year revenues will be significantly ahead of 2018.
Management has been working hard to eliminate costs and during the period central costs were down by 23% year-on-year, contributing to a significant narrowing of the underlying loss (EBITDA) to £49,000 from a restated loss the year before of £402,000.
The reported loss before tax was £787,000, including a £24,000 loss from discontinued operations, compared to a restated loss the year before of £1.2mln.
The group signed a joint venture (JV) agreement in March with Scanport in Ghana, with the JV set to become the sole operator for a new long-term managed services project for container screening services at the new US$1.5bn Tema container port terminal in Ghana.
Westminster expects all contracts to be finalised in the coming weeks and the port to be fully operational by the end of the third quarter and to be contributing to the Managed Services division's results in the second half of the year.
“This large and prestigious project is a major step forward for the Managed Services Division opening up new long-term, recurring revenue streams and opportunities in a new sector,” said Peter Fowler, the group's chief executive officer.
"We have also signed other important joint venture agreements. We signed a joint venture agreement with a significant partner in the Kingdom of Saudi Arabia, Hazar International, setting up Westminster Arabia in the Kingdom, opening up a number of potential projects and we also signed a strategic alliance with the Gulf Aviation Academy, a leading provider of professional aviation training in Bahrain and the wider Middle East and North Africa ('MENA') region, greatly expanding our range of services to existing and potential clients. Both are important strategic developments for the business,” Fowler added.