Northbridge Industrial Services (NBI ) said it is confident that the pre-exceptional profit before tax for the year will be in line with management’s expectations as group revenue is expected to have increased to £38.8m with the group’s Crestchic division showing ‘significant’ growth.

In a trading update ahead of its results announcement for the year ended 31 December 2021 scheduled for April 2022, the industrial services and rental company said group revenue for the year is expected to have increased to £38.8 million, up from £34.0m reported in 2020.

In particular, the company reported ‘significant’ growth within its Crestchic division, which designs, manufactures and hires loadbanks to test generators and critical power supplies. The division’s revenues increased by 20% to £29.4m, up from £24.6m reported in 2020.

Within Crestchic, hire revenue increased by 34% to £15.4m, up from £11.5m in the prior year, while d sales and service revenue increased by 7% to £14m, up slightly from £13.1m in 2020.

With demand continuing to be strong, equipment sales would have grown further ‘but for capacity and supply chain constraints,’ which the company expects to be resolved when the factory expansion comes on stream in the second quarter of 2022, it told investors today.

The Company said this morning that it remains in a highly cash generative position and that year-end pre-IFRS 16 net debt has fallen to £1m, down from £5.4m as at 31 December 2021. 

To date, in 2022, for the fourth year in a row, the factory order book for the outright sale of loadbanks started the year at a record level and the secured Crestchic hire revenue is well ahead of this point last year with good visibility already into 2Q, Northbridge told

investors.

The company explained that its current ongoing pipeline of rental projects is ‘encouraging’ across all the regions in which its Crestchic division operates with data centre work in Europe and energy and marine projects in the Middle East and Asia being particularly strong.  

It also recently won its first significant rental order for testing a data centre outside of Europe.

Northbridge  said its US business continues to grow its revenue, stating that a lease has been signed on a new depot in Texas which will become operational towards the end of 2Q22. 

Shares in Northbridge Industrial Services were trading 6.54% higher at 171p this morning.

It said an order for US manufactured loadbanks for heat load testing in data centres has been placed which will provide the equipment for the entry into this sector of the US market.

Meanwhile, a new factory built in Burton on Trent is said to be ‘progressing well’ and will enable Crestchic to increase sales revenue and expand its load bank hire fleet from 2H22.

Last month, Northbridge confirmed that the exit of Tasman - its oil drilling rental tools division - from Malaysia and Singapore had been finalised and that the exclusive discussions on the sale of the division to Australian and New Zealand entities were progressing as a result.

Today, Northbridge told investors that it has now exchanged contracts for the sale of its Tasman operations in Australia and New Zealand (Tasman ANZ) to Well Integrity Group Ltd and an associated company, with completion expected on or before 28 February 2022. 

The aggregate purchase consideration to be paid by Well Integrity Group for Tasman ANZ is £4.13m and the book value of the transferring assets is expected to be A$9.10m (£4.79m). 

Tasman as a whole is expected to break even on a trading basis for 2021 and the estimated final exceptional charge related to the restructure and disposal of the division, as noted in a previous announcement last month, remains unchanged at between £6.0 and £7.0 million.

In addition, the company has also announced today that Nicholas Mills, an employee of Harwood Capital LLP, has been appointed as Non-Executive Director with immediate effect.

Northbridge has also noted that it intends to host a virtual capital markets event on 10 March 2022 where it will make a presentation in which management will outline the strategic direction and exciting future prospects of the Group, followed by an interactive Q&A session.

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