Shares of Newcastle-based building services firm Northern Bear plc rose about 30% after it published an update on its corporate strategy, dividend policy and trading for the company and its subsidiaries for the year ended March 31, 2023.

“After a review of strategy and dividend policy, the board is pleased to report that the group will pursue a dividend growth strategy supported by the organic progress of the group’s businesses and, to the extent accretive, bolt-on acquisitions,” said Northern Bear.

“To that end, the group is pleased to announce its intention to declare an ordinary dividend of 4p per share plus a special dividend for FY23 of 1p per share.

“Going forward, the ordinary dividend is expected to be paid semi-annually, with half paid after each of the year-end period and the half year period, respectively.

“Additionally, the company intends to further increase its engagement with the broader investment community.”

On trading, Northern Bear said: “In the interim report for the six months to 30 September 2022 (HY23), we reported that the group generated strong operating results despite ongoing industry-wide challenges with respect to attracting and retaining employees in the construction industry.

“Based on management information for the eleven months to February 2023, the group has traded ahead of the prior year’s results except for a provision at our Northern Bear Building Services Limited subsidiary, anticipated to be in the range of £500-£750k, to account for certain unprofitable contracts.

“The board expects that operating profit for FY23, stated before amortisation, one-off costs, and other adjustments (in the format used in prior years’ results, ‘adjusted operating profit’) should exceed £2.75 million (or £2.0-£2.25 million of reported operating profit net of the provision), and we anticipate a net cash position for the group at year-end.

“As we have emphasised previously, the net cash or bank debt position can vary significantly and rapidly given the nature, size, and variety of contracts and their associated working capital requirements.”

Northern Bear chair Jeff Baryshnik said: “We are pleased to announce strong expected operating results for FY23 and are excited to implement our dividend growth strategy.

“We look forward to further engaging with shareholders and the wider investment community to inform them about the group.”