Renew shares fall as trading slows, but orders strong

Shares of Leeds-based engineering services and infrastructure group Renew Holdings plc fell as much as 20% after the firm published a trading update for the year ending September 30, 2025, ahead of its Annual General Meeting on January 27, 2025.

“As indicated in the group’s final results announced on 26 November 2024, trading within the rail sector has been impacted by the slow start to the Control Period (CP7), which commenced in April 2024,” said Renew.

“This lower-than-expected level of activity has continued in recent weeks, as has been widely reported. Consequently, trading in the Group’s Rail sector is now behind management expectations. 

“Given the ongoing challenges with delay and deferment in our Rail activities and more recent uncertainty over timing of the commencement of a number of renewals programmes, the Board anticipates full year trading will be below market expectations albeit adjusted operating profit is still expected to be ahead of prior year (2024: £70.9m). Having operated in this sector through previous control period transitions, we believe that this situation will normalise as we move through the cycle. Our clients remain committed to record levels of expenditure in renewing and maintaining the national rail network to satisfy their regulatory obligations.  

“In Environmental, activity levels in Water are ahead of expectations and we anticipate strong momentum through the transition to the new control period AMP8 which commences in April 2025.

“In the period we were appointed by Affinity Water to two new major 5-year frameworks, further strengthening our position ahead of the next control period. Forecast trading in our Energy and Infrastructure sectors remains in line with management expectations.

The integration of our recent acquisitions, Excalon and Full Circle is progressing well and trading at both is forecast to be in line with expectations for the full year. In line with our strategy, the Group continues to review an active acquisition pipeline.

Through further framework success, the order book is at a record level, providing long-term visibility and at 31 December 2024 it was £905m (31 Dec 2023: £795m Engineering Services).”