8th Aug 2018 11:23
LONDON (Alliance News) - Morgan Sindall Group PLC on Wednesday said it expects full-year results slightly ahead of expectations following a significant profit growth in the first half of 2018.
The stock was trading 4.4% higher on Wednesday at 1,488.00 pence per share.
The construction & regeneration company said pretax profit grew by 29% to GBP29.9 million in the six months to the end of June from GBP23.1 million reported for the same period a year earlier, as revenue improved by 9% to GBP1.42 billion from GBP1.31 billion.
Morgan Sindall is organised into six divisions: Construction & Infrastructure, Fit Out, Property Services, Partnership Housing, Urban Regeneration, and Investments.
The company said its Construction & Infrastructure unit made significant progress with its focus on quality of earnings and contract selectivity, with its margin improving to 1.7% from 1.1% the year before. Although the revenue in this division dropped by 5% to GBP662 million, operating profit climbed 49% to GBP11.3 million.
The Fit Out unit delivered another excellent performance, with revenue and profit, all increasing by 26% to GBP426 million and 29% to GBP18.8 million, respectively. Looking forward, Morgan Sindall said its outlook for Fit Out division in the second half of 2018 is very positive.
Profit from the Urban Regeneration segment totalled GBP6.1 million, multiplying on the prior year.
However, performance in the Partnership Housing division was disappointing, Morgan Sindall said, with profit down 16% to GBP4.6 million, primarily impacted by one poor performing contracting project in London.
The Investments unit also made a loss of GBP1.1 million as a result of slippage in the timing of a number of its key developments.
The company's order book stood at GBP3.60 billion at the end of the period, 6% lower than at the start of the year.
"I am pleased to report another strong set of results," said Chief Executive John Morgan. "The group is on track to deliver a result for the year which is slightly ahead of its previous expectations."
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