Newcastle building firm Northern Bear has warned investors its profits will fall this year, as its performance will not live up to its “exceptional” 2018.
Northern Bear has told investors that it expects its half-year profits to come in at least £300,000 lower than the £1.7m the company made last year.
Instead the company believes it will make an operating profit of between £1.3m and £1.4m for the six months ending September 30 2019.
The fall in profits was caused after the company suffered a number of contract delays in the first quarter. These delays have now been resolved leading to an uptick in work during Q2.
In a statement made to investors executive chairman Steve Roberts said: “When we reported the interim results for the six months to 30 September 2018, we stated that these results were considered exceptional. Whilst we are greatly encouraged by performance in Q2, the slower trading in Q1 will mean that reported results for H1 FY20 will be below those for H1 FY19.
“The board’s current expectation is that operating profit, stated before amortisation and other adjustments (in the format used in our FY19 results), is expected to be in the range of £1.3m to £1.4m (H1 FY19: £1.7m).”
The firm added that it holds a “significant order book” and expects to experience a strong second quarter that will continue into the second half of the year.
Northern Bear recently found itself to be a target by an investment firm owned by Canadian real estate tycoon, which revealed it wanted to acquire millions of pounds worth of its shares.
Cedarvale Holdings revealed at the start of the month that it wishes to acquire 5.4m shares in Northern Bear in a deal worth £3.89m.
Cedarvale is owned by Jeff Baryshnik, who works as president of Republic Funds USA Inc, which he founded in 2009. Currently Mr Baryshnik owns a 0.44% stake in Northern Bear.
Northern Bear’s shareholders have been offered 72p per share by Cedarvale, which was 20% premium on their value at the time the deal was put forward.
The shareholders have until October 24 at 1pm to accept or decline the offer.
