13th Dec 2007 07:01
Morgan Sindall PLC13 December 2007 Morgan Sindall plc Pre-close Trading Update The Board of Morgan Sindall today announces a trading update, prior to its closeperiod, for the year to 31 December 2007. The Group's preliminary results willbe announced in February 2008. Trading The Group continues to perform in line with management expectations for thecurrent year and the positive outlook for 2008 across all our business areasremains unchanged. The Fit Out division is continuing to secure contracts across all market sectorsand in particular from the financial services sector. Tender enquiry levelsremain buoyant and management remains of the view that the outlook for 2008 isfor similar levels of activity to those of the current year. The order book iscurrently at a comparable level to that at the same stage last year givingmanagement an informed view on the market for the next six months. The construction market has steadily improved during the year and theConstruction division is seeing strong growth in its revenue as a result of bothorganic growth and the acquisition of the Design and Project Services businessfrom Amec in July this year. The division continues to focus on key clients andcontracts, such as local authority frameworks, which give it greater longer termvisibility. Infrastructure Services' market outlook remains positive with key projectssecured last year continuing to progress well and it is anticipated that marginswill recover to close to 2% for the full year, with further progressionanticipated next year. Affordable Housing's margin is again expected to be ahead of that in previousyears, on revenue at a similar level to 2006. The division continues to see ahealthy pipeline of mixed-tenure and Decent Homes opportunities and the outlookfor the affordable housing market is positive as it remains a key Governmentpriority. Following its acquisition in July, Development is trading in line with ourexpectations and the opportunities for the division remain encouraging. With itsfocus on long term strategic partnership arrangements, predominately through PPPstructures, the division is particularly well placed with a secure forwarddevelopment programme with minimal exposure to the revaluation issues currentlyaffecting the property sector. The pipeline has been significantly strengthenedby the division's appointment to preferred bidder status on various regenerationschemes at Swindon, Doncaster, Blackpool and Manchester Victoria during theyear. Overall the forward order book stands at £4.2bn compared to £3.3bn at the startof the year and a modest increase over the position at June. This represents anunderlying increase of 11% on the start of the year after excluding the impactof the order book relating to the acquisition. Average cash balances have beenparticularly strong throughout the second half of the year. The currentperformances of our divisions and the growing order book underpin our view thatthere is sustained strength in the construction and regeneration markets inwhich we operate and that the outlook for the Group remains positive. Enquiries:Morgan Sindall plc Tel: 020 7307 9200Paul Smith, Chief ExecutiveDavid Mulligan, Finance Director Blythe Weigh Tel: 020 7138 3205Tim BlythePaul Weigh This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Morgan Sindall Group