13th Feb 2019 08:43
LONDON (Alliance News) - Galliford Try PLC on Wednesday reduced its interim payout as it reported a drop in revenue and profit.
However, the company also guided for its annual results to come in at the upper end of market expectations.
Shares in the company were trading up 3.0% at 741.50 pence each early Wednesday.
For the six months to the end of 2018, the FTSE 250 housebuilder's revenue fell to GBP1.34 billion from GBP1.40 billion in the comparative period a year ago. Pretax profit was down 4% year-on-year to GBP53.8 million.
The company cut its interim dividend by 18% to 23 pence per share from the 28p paid to shareholders a year ago.
During the half, Galliford reported a GBP26 million charge related to the Aberdeen Western Peripheral Route, which was set back by the collapse of partner Carillion.
Looking ahead, at a group level, the company reported an increase in total sales currently reserved, despite its current order book standing at GBP5.4 billion, lower than the same period last year at GBP5.6 billion.
"The group enters the second half of the year with a solid foundation, underpinned by a strong balance sheet and our focus on high-quality earnings which will drive further margin improvements over time," Chief Executive Officer Peter Truscott said.
"Our mix of residential development creates a robust proposition in more uncertain markets. We remain cautious of the impact of the current political uncertainty on consumer and business confidence, and the medium-term outlook for the macro economy, but believe our focused strategic objectives, strong order book and disciplined approach will deliver a full year out-turn toward the upper end of the analysts' current range."
Analysts currently expect Galliford's pretax profit in the range of GBP158.8 million to GBP192.5 million. Pretax profit in its last financial year was GBP143.7 million.
With regards to Brexit, the company sees no impact from the UK's exit from the European Union on its business, if a deal is reached between the parties. Otherwise, in the event the UK leaves the EU without a deal, "the biggest impact we foresee is the effect on our markets of a potential severe decline in consumer confidence and economic activity in general", Galliford said.
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