Severfield, the Thirsk, North Yorkshire-based international steel group, warned on Tuesday it is “adopting a cautious view of the year ahead” and now expects FY27 underlying profit before tax to be in the range of £12 million to £15 million.

Severfield said the caution reflects “increased geopolitical uncertainty, together with broader macroeconomic conditions, the impact of later project start dates, and a continued tight pricing environment.”

In a trading update ahead for the year ended March 28, 2026, Severfield said FY26 underlying profit before tax is expected to be in line with current market expectations of £10.2 million.

“UK and Europe order book of £438m provides good visibility, comprising a mix of near-term projects and larger anchor projects, although current subdued market conditions have seen delays in some start dates to late FY27,” said the firm.

“Record Indian order book of £331m demonstrates continued strong momentum, with record output in FY26 and expansion at the new Gujarat facility progressing to plan.

“The board’s expectations for FY27 are for underlying profit before tax to be in the range of £12m-£15m, reflecting a cautious view of the year ahead based on later project start dates, the current tight pricing environment, macroeconomic conditions, and current geopolitical uncertainty.

“New management’s review of the business has continued to progress well, with the implementation of early changes, such as the previously announced discontinuation of the non-core Modular Solutions business. The review will be concluded ahead of the year end results announcement in June 2026, when management expects to provide an update.”

In its outlook, the company said: “Although the group continues to see a good pipeline of opportunities, market conditions in the UK and Europe have remained subdued, reflecting macroeconomic uncertainty, elevated interest rates, and geopolitical instability, weighing on business confidence and the timing of project awards.

“The Industrial, Stadia and Commercial sectors have been particularly impacted; the group has secured replacement work, principally across continental Europe, to maintain factory utilisation.

“Start dates for several large, secured projects that were previously expected to commence in early FY27 have been delayed, with a number now anticipated to enter production in the second half of FY27. As a result, whilst the order book continues to provide good visibility of future activity, it reflects a mix of near-term work secured at tighter margins and larger projects scheduled to commence later in FY27.

“We also remain mindful of the ongoing conflict in the Middle East, which continues to disrupt global trade routes and supply chains, and drive energy price volatility. The current direct cost exposure of the group is limited, reflecting our well-established policies of securing steel prices at contract stage and hedging key commodity costs.

“However, whilst these measures provide a degree of short-term protection, the situation remains uncertain and largely outside the group’s control. Prolonged disruption or further escalation could give rise to broader impacts on project timelines, supply chain reliability and overall market conditions. We will continue to monitor developments closely and take further mitigating actions as appropriate.

“Accordingly, the board is adopting a cautious view of the year ahead and now expects FY27 underlying profit before tax to be in the range of £12m-£15m, reflecting increased geopolitical uncertainty, together with broader macroeconomic conditions, the impact of later project start dates, and a continued tight pricing environment.

“Following the appointment of new leadership, the group has continued to progress its previously announced review of the business, aimed at ensuring it is well positioned to deliver sustainable long-term growth and improved profitability.

“As part of this process, the group has begun implementing a number of changes, including the previously announced decision to discontinue its sub-scale Modular Solutions business. The review will conclude before the presentation of the year end results in June, when management will update the market.”