Severfield - Progress made, more expected

A good all-round performance in FY18 provided some positive markers of progress including rising UK margins, a steep step-up in the Indian JV order book and a special dividend declared for the year. While we acknowledge some sector variations, the overall trading outlook appears to be similarly robust and our estimates are modestly higher now. A c 4% near-term yield (ie final plus special DPS) is an obvious draw. Sector diversity provides resilience and additional growth potential in our view.