12th Sep 2024 09:21
(Alliance News) - Kier Group PLC on Thursday said a strong order book bodes well for future growth as it unveiled annual earnings growth.
The Manchester-based infrastructure firm said revenue in the year to June 30 totalled GBP3.91 billion, a rise of 16% from GBP3.38 billion.
Pretax profit increased 31% to GBP68.1 million from GBP51.9 million. Basic earnings per share rose 24% to 11.8 pence from 9.5p before.
Kier resumed its dividend during the financial year. It proposed a final dividend of 3.48p per share, taking its total payout to 5.15p. The period saw it pay its first dividend since financial 2019.
Kier highlighted a "high quality" order book which rose 7% to GBP10.8 billion from GBP10.1 billion. This provides "significant visibility" over financial 2025 and beyond, the firm said.
Approximately 60% of the order book is under target cost or cost reimbursable contracts, Kier said.
The remainder of the order book is on fixed priced contracts where the risk is negotiated and managed with customers and supply chain partners, the firm added.
Current trading is "in-line with board expectations", Kier said.
The firm also set out a "new long-term sustainable growth plan".
"Our core businesses are well-placed to benefit from UK government and regulated industry spending commitments to invest in UK infrastructure. We believe UK infrastructure spending commitments are driven by structural demand which have a positive influence on Kier's chosen markets. Population growth, transportation pressures, aged infrastructure, energy security and climate change are substantial and largely non-discretionary," it explained.
For revenue, Kier is targetting GDP plus growth through the cycle, together with an adjusted operating profit margin of at least 3.5%.
Kier is aiming for a "sustainable" dividend policy, seeking around 3 times earnings cover through the cycle.
Shares in Kier fell 2.3% to 146.75 pence each in London on Thursday.
By Jeremy Cutler, Alliance News reporter
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