Van Elle Holdings – getting the last trading year out of the way and then looking purposefully forward, this group’s shares at 39p could well be in line for another upward push

21.07.2025

This coming Wednesday, 23^rd July, will see Van Elle Holdings (LON:VANL), the UK's largest specialist geotechnical engineering contractor, gradually getting itself back into investor’s good books.

On that day that the group is due to announce its results for the year to end-April.

The Business

Van Elle Holdings, which was formed in 1984 and listed on AIM in 2016, provides a wide range of ground engineering techniques and services including ground investigation, general and specialist piling, rail geotechnical engineering, modular foundations, and ground improvement and stabilisation services.

It operates through three divisions: General Piling, Specialist Piling and Rail, and Ground Engineering Services; and is focused on diverse end-markets including residential and housing, infrastructure and regional construction - across which the group has completed more than 20,000 projects over the last 35 years.

Latest Trading Update

The market had been forewarned way back in late January this year, when it announced with its Interim Results that times were proving a little tougher than hoped.

Then in the middle of March, it declared that market conditions had proved somewhat challenging; despite benefitting from a strong order book, the trading environment and volumes had remained suppressed throughout January and February.

At the start of last month, Thursday 5^th June, the £47m-capitalised group issued a Trading Update for the 12 months to end-April.

It indicated that the year will be reporting around a 4% drop in revenues at £134.0m, reflecting the challenging market conditions that prevailed throughout that Period.

The group experienced subdued activity levels and widespread delays to contract start gates, in particular due to significant delays to Building Safety Act approvals.

It also noted that the start of several major contracts, which were due to commence in the final quarter of FY25, were deferred into the current year, impacting the final quarter performance.

That also hit the bottom line, with underlying pre-tax profits expected to come in at some £3.5m.

The good news becoming evident was that the group’s Order Book at the year-end was around £41.5m (£35.1m), which did not include the £10m industrial sector contract awarded to the group’s piling division in May.

Management Comment

At that time CEO Mark Cutler stated that:

"The last 12 months have been challenging for the business, and although it is disappointing that a recovery in activity levels didn't materialise as expected, against a volatile backdrop the performance as a whole demonstrates the progress made over recent years.

Through organic initiatives and selective, strategic M&A, Van Elle now provides a wider and more diverse range of service offerings and is very well positioned across a range of attractive growth markets aligned to the UK Government's investment priorities.

Amongst an increasing number of frameworks, the Group has agreed two more customer partnerships in the energy and water sectors and has a growing order book, underpinning our confidence in delivering strong growth in revenues and profitability when markets recover."

The Equity

There are 108.2m shares in issue.

The larger holders include Ruffer (17.88%), Otus Capital Management (13.99%), Harwood Capital (10.03%), Peter Gyllenhammar AB (7.12%), Premier Miton Group (6.94%), NR Holdings (5.55%), TrinityBridge (5.17%), and Puma Investment Management (3.00%).

Broker’s Views

The general expectations are now for the current year to increase the group’s net sales from £134m to £150m, with a possible doubling of earnings before tax to £6m plus, taking earnings up to 4.6p per share in the year to end-April 2026.

There are estimates out for the group’s net asset value per share of some 50p in 2025 and up to 54p in this trading year.

However, after this Wednesday’s results announcement I anticipate new estimates being issued by analysts.

My View

A year ago, the group’s shares were trading at 45.00p, before they fell right back to 31.97p on the back of the March issued Update.

At that time, I featured the group, considering that longer-term investors should be picking up stock – they were then 34.00p.

Subsequently they have been up to 46.50p, in reaction to the early June Update.

After some profit-taking, the shares are now back to 39.50p – at which level I would suggest that they are ready for another run at higher pricing.

Perhaps the accompanying statement on Wednesday, and the subsequent Broker’s Analyst comments, will all add to the upward momentum.

I fancy the shares for another push back up to 47p and above – they hit 56p two years ago.

(Profile 29.03.21 @ 37.5p set a Target Price of 47p*)

(Profile 14.03.25 @ 34p set a new Target Price of 42p*)

Asterisk * denotes that Target Price has been achieved since Profile publication.