James Fisher reports solid half-year amid strategic turnaround

(Sharecast News) - James Fisher and Sons reported a solid first-half performance on Tuesday, in line with expectations, as it continued to make strategic progress in its turnaround. Despite growing macroeconomic uncertainties, the London-listed company said conditions in key end markets remained largely supportive, contributing to a robust trading performance.

For the six months ended 30 June, James Fisher said it expected underlying operating profit to be around £11m - a 14% increase driven by margin improvement from self-help initiatives and enhanced supply chain efficiency.

Revenue was set to be in line with the first half of 2024, after adjusting for the impact of disposals and business closures.

The firm's net debt-to-EBITDA ratio was projected to be around 1.7x, slightly above the target range of 1.0x to 1.5x, due to front-loaded capital investments aimed at supporting future growth.

The company said it continued to invest in new technology and product development, including the next generation of multi-role rebreathers, submarine capabilities, and tactical diving vehicles.

Those initiatives formed part of a broader effort to support long-term growth, with the energy and defence divisions being key focus areas.

In particular, James Fisher said it had targeted £19m in investments across its seven key sub-segments within energy and defence, including the replacement of its tankships fleet.

"I am pleased to report another period of solid trading and continued strategic progress through the James Fisher turnaround," said Jean Vernet, chief executive officer.

"Market conditions remain largely supportive, and we are focused on delivering on the next chapter of our business turnaround, positioning the Group for growth."

The board said the energy division performed well, particularly within well services, and made significant strides in decommissioning, which turned around prior year losses.

However, inspection, repair and maintenance (IRM) remained an area for improvement, with further progress expected in the second half of the year.

The board said the major port infrastructure project in Mozambique was successfully completed in the half-year.

In the defence division, the outlook was supported by increased global defence investment.

The business said it made important steps forward in growing strategic markets, including north east Asia and the US.

Meanwhile, maritime transport saw strong performance in tankships, driven by high utilisation and contracted rates, although Fendercare was impacted by the lack of LNG ship-to-ship activities.

James Fisher said it was continuing to focus on its strategic goals of achieving an underlying operating profit target of 10% and a return on capital employed target of 15%, with progress expected to be driven by self-help initiatives, improved business unit performance, supply chain integration, and a recovery in the defence division.

Trading in July had been in line with expectations, and the board said it remained confident in delivering further progress for the full year.

James Fisher said it would announce its interim results for the six months ended 30 June on 9 September.

At 1221 BST, shares in James Fisher and Sons were up 6.02% at 370p.

Reporting by Josh White for Sharecast.com.