Office fit-out specialist Styles & Wood (STY:AIM) lights up the AIM leaderboard, gaining 18% to 239p, as investors welcome a third successive set of impressive results.
Full year numbers confirm progress indicated in June and September last year which helped the stock end 2015 as one of the market’s top performers, up around 144%.
Balance sheet weakness has been addressed through a refinancing alongside full-year results last year and blue chip contract wins during 2015 including TSB Bank and Aviva (AV.) helped deliver a 55% uplift to underlying operating profit.
Long-term contracts with blue chip customers, mainly in finance, alongside a targeted approach to growth in other sectors are key components of chief executive officer (CEO) Tony Lenehan’s strategy.
‘We’ve developed and refined an approach that leads us to where we are today,’ says Lenehan, who became CEO in 2011.
‘In retail, we see clear opportunities around the reconfiguration of existing store formats and changes in use of existing space.
‘In the public sector, in higher education and health in particular, there’s a need to do more with existing assets and that’s driving interest in terms of refurbishment and fit-out.
‘Commercial fit-out is benefiting from a concentration of lease events which can create sustainable business interest for the next three to five years.
‘The risk is if you are a pitching generally for a share of the market. The approach for us, and what we’re focusing on, is working on these specific elements within sectors.
‘We want to differentiate what we do and through clever systems-based solutions and our strategic asset management focus I think we can do that.’
Results for the year to 31 December 2015 showed net debt declined from £11.3 million to £1.4 million as a result of the restructuring and operational cash flow.
Underlying earnings per share increased 47% to 37.2p, from 25.3p a year earlier. Turnover improved 18.6% to £115 million.
Finance officer Philip Lanigan says revenue growth, cost cutting and the benefits of the refinancing – which led to improved payment and pricing terms with customers and suppliers – all contributed to the result.