5th Jul 2006 07:00
Galliford Try PLC05 July 2006 GALLIFORD TRY PLC TRADING UPDATE Galliford Try plc, the construction and housebuilding group, is providing thefollowing update to trading for the year to 30 June 2006 prior to entering itsclose period. Key Highlights •Full year profits expected to be substantially ahead of last year and in line with expectations •Integration of Chartdale Homes and Morrison Construction progressing as planned •Strong cash flows, cash in hand at year end •Construction order book at record £2.3 billion (2005: £950m) •Housebuilding completions over 1,000 for the first time at 1,054 homes (2005: 853 homes) •Housebuilding sales carried forward at record £78m (2005: £65m) •Landbank at record 4,022 units (2005: 2,455) •Financial close on £134m Highland Schools PFI •Awarded land remediation contract for Olympic Park in east London, and appointed preferred bidder by English Partnerships for redevelopment of 17 acre site in Camborne, Cornwall Outlook Galliford Try expects to report full year profits substantially ahead of lastyear and in line with expectations. The two significant acquisitions made in thesecond half of the year, Chartdale Homes and Morrison Construction are bothperforming well, and meeting our expectations both in terms of operationalperformance and prospects for the future. Our construction divisions aregenerating strong cash flows, with the Group achieving overall cash in hand atthe year end. Construction The integration of Morrison is being achieved in line with our plans, and we areconfident of achieving the anticipated savings to our cost base. Since the startof our new financial year on 1 July our construction activities are operating astwo divisions, building and infrastructure, targeting clearly defined marketsectors with the objective of building on our significant presence in each ofthem. Both divisions start the new financial year with order books of over £1.1billion, resulting in a total construction order book of £2.3 billion. Of thistotal, 90% is in the public and regulated sectors and over 90% has been securedon a non price competitive basis. The building division has a good spread of work boosted by the financial closeof the Highland Schools PFI in April. Securing the project was a key objectivefor Morrison, bringing £134m of work into the division over the next threeyears. The project underlines our substantial presence in the education sector,building on Galliford Try's existing portfolio of both individual projects foruniversities and schools with the £192m Northamptonshire Schools PFI projectthat reached financial close in the first half of the financial year. Our infrastructure division is in a strong position. It is working, primarilythrough long term frameworks, for most of the UK's water companies, Southern,Thames, Anglian, United Utilities, Welsh, Yorkshire and Scottish, for whom wehave just agreed an extension to our existing framework which is expected toprovide another £70m of work over the next two years. The Morrison acquisitionhas added a significant skill base in highways infrastructure, renewable energyprojects and remediation. These are all sectors with good growth prospects andlast month we were delighted to be awarded the land remediation contract for thenorthern section of the Olympic Park in east London, which we expect to providework until 2010. We are also working on a number of highways projects under thenew "early contractor involvement" contracts that suit our collaborativeapproach to major construction projects. Housebuilding The housing market picked up in the second half of our financial year, and ourhousebuilding division exceeded its sales targets in a market that, with thelimited use of incentives, remains at an acceptable level. Completions for theyear were up 24% at 1,054 at an average selling price up 2% to £212,000. Weended the financial year with record sales carried forward of £78m, compared to£65m last year. The results will include four and a half months trading from Chartdale Homes,acquired on deferred payment terms for £67m in February. We are pleased with theprogress made, with sales meeting expectations and the planning consentsoutstanding at the time of acquisition now secured. We have continued to selectively add to our landbank across our regions in thesouth west, south east and eastern counties of England. We acquired 1,350 plotswith our acquisition of Chartdale and enter the new financial year with a recordlandbank of 4,022 units, compared to 2,455 last year. Our presence in the affordable housing market continues to grow. We weredelighted to announce in May that we were appointed preferred bidder by EnglishPartnerships for the joint development of a 17 acre site in Camborne, Cornwall,which is expected to provide a total of 390 homes, both affordable and for sale,as well as around 88,000 square feet of office, light industrial and communitybuildings. Preliminary Results The preliminary results for the year to 30 June 2006 are expected to beannounced on Thursday 7 September 2006. Further enquiries to: Greg Fitzgerald, Chief Executive Galliford Try plc 01895 855 219Frank Nelson, Finance Director Galliford Try plc 01895 855 226David Rydell/Geoff Callow, Bell Pottinger Corporate & Financial 020 7861 3232 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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