MIDAS SHARE TIPS: You'll warm to radiator firm Stelrad


MIDAS SHARE TIPS: You’ll warm to investing in trendy radiators with Stelrad – a company with a history stretching back to the 1930s

  • The company sells six million radiators a year, mainly in the UK and Europe
  •  It floated two months ago, led by chief executive Trevor Harvey 
  • Trading update this week should indicate strong progress through 2021


Trevor Harvey graduated from Newcastle University with an engineering degree in the 1970s. He has been involved in the radiator industry ever since. 

A Geordie born and bred, Harvey is now chief executive of Stelrad, the UK’s number one radiator group. The company sells six million radiators every year, with market-leading positions not just here but in countries across Europe too. 

With a history stretching back to the 1930s, Stelrad floated on the stock market two months ago at £2.15, since when the price has drifted back to £2.08. The fall, while slight, seems misguided. 

On trend: Stelrad is growing fast as families trade up to a wide range of feature radiators when renovating their home

On trend: Stelrad is growing fast as families trade up to a wide range of feature radiators when renovating their home

A trading update this week should indicate that Stelrad made strong progress through 2021 and, looking ahead, Harvey is determined to deliver further growth, increasing market share, moving into related products and buying up smaller competitors. 

Harvey has been part of Stelrad since 2000 when he led the purchase of Caradon Plumbing from Caradon, then a listed company. 

Harvey streamlined the business, changed its name to Stelrad and opted to focus exclusively on radiators. 

Since that time, Stelrad has benefited from significant investment, designed to make production nimbler, more efficient and more competitive. 

The strategy has worked, taking Stelrad’s share of the UK market from less than 40 per cent to more than 60 per cent, with substantial positions overseas too. 

Headquartered in Newcastle, the group operates from manufacturing sites in Mexborough, South Yorkshire, Holland and Turkey. 

Each site specialises in particular products but they can all do everything, making Stelrad less susceptible to supply chain problems. 

The Turkish site gives Harvey a particular advantage as costs are in the weak local currency, while sales are in sterling and the euro. 

Most radiators last for decades so new installations generally take place when properties are built or refurbished. 

Around half of Stelrad’s sales come from renovations, a growing market over the past couple of years, as people have spent more time at home and opted to splash out on upgrades. 

In the past, radiators were invariably the same size, shape and colour – white. Today, there is a plethora of choice and many consumers are choosing to trade up, with brightly coloured products designed to be features within a room rather than blending into the background. 

Stelrad is a key player in this sector and robust progress is expected, especially as the company has an established and fast-growing online business. 

Stelrad also works with top housebuilders, installing radiators for private homes and social housing, and it works with commercial customers too, from top hotels and restaurants to hospitals and schools, many of which need special safety products, that don’t feel hot to the touch. 

Brokers expect revenues to increase by almost 40 per cent to £275million for the year just ended, rising to at least £300million in 2022. Profits are forecast almost to quadruple to £21million in 2021, soaring to £31million this year. 

Unusually for a newly listed business, Stelrad intends to pay dividends from this year, with an 8.1p payout scheduled for 2022, rising to 8.6p next year.

Midas verdict: Having worked at Stelrad for more than two decades, Harvey floated this company with one aim in mind – to make it bigger and better. Further market share gains are likely, complementary acquisitions are on the cards, and the dividends provide an attractive yield as well. At £2.08, the shares should deliver long-term rewards. 

Traded on: Main market Ticker: SRAD Contact: stelradplc.com or 0191 261 3301 

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