Severfield (LSE:SFR), the UK and Europe structural steel group, said trading since the start of its 2027 financial year is in line with the board's expectations, ahead of Tuesday's annual general meeting.
Guidance for underlying profit before tax of £12m-£15m remains unchanged, with the market backdrop described as consistent with the outlook given alongside its FY26 results on 23 June. The order book stood at £534m at 1 July, up from £507m a month earlier, driven by project wins in the data centre sector across the UK, Germany and Sweden, with £375m scheduled for delivery over the next 12 months.
Continental Europe now accounts for 32% of the UK and Europe order book, up from 28%, reflecting an increasing share of higher-quality work that is expected to support margin progression as projects move through delivery.
The company reiterated that FY27 remains a transition year, with first-half profitability reflecting lower-margin work secured in a competitive pricing environment, while profit from larger, higher-quality contracts is expected to fall predominantly in FY28.
Its Indian joint venture, JSSL, reported continued growth in revenue and output, with its order book rising to £327m at 1 July from £267m a month earlier, supported by data centre awards and new orders from partner JSW.
"We have made a positive start to FY27, with trading in line with expectations and guidance unchanged", said chief executive Paul McNerney.
Severfield will report half-year results for the six months to 26 September on 24 November.
News Intelligence what this means for the company
Severfield confirmed its FY27 profit guidance of £12m–£15m unchanged and reported order book growth to £534m, driven by data centre wins across the UK and Continental Europe. The company frames FY27 as a transition year: near-term profitability will be depressed by lower-margin work from competitive bidding, but larger, higher-quality contracts—now representing a growing share of the book—are expected to deliver profits predominantly in FY28, suggesting the current guidance may understate medium-term earnings power.
The order book expansion and margin-accretive mix shift (Continental Europe now 32% of the book, up from 28%) support the thesis that FY27 guidance is conservative. However, the company's own framing of FY27 as a transition year means near-term earnings will remain under pressure; the investment case hinges on execution of the higher-quality contract pipeline and the timing and margin realisation of FY28 delivery.
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