Construction, services and property group Kier has this morning unveiled a 4.6% fall in total revenues for the six months ended on the past 31st of December.
Interim underlying profits (which exclude the amortization of intangible assets) rose 8.6% to £34m, leading to underlying earnings per share of 70.3p, compared to 63.5p one year ago.
The above despite a fall in margins in its construction arm to 2.5%, from 2010 levels of 2.7%.
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According to the company net cash at year end 2011 stood at £131m. That constitutes a drop versus the £165m that it had on hand at year end 2010, but was due to £33m of funds having been reinvested in the group.
As well, the company highlights that its construction and services order book is still over £4bn. Its construction order book already covers 68% of the revenues targeted for 2013, while in services the figure is 76%.
The companys chairman, Phil White, expects the firms "good performance" to continue for the full year.
However, he adds that when looking to the medium-term conditions continue to be difficult in the UK construction market and that they are inevitably seeing greater pressure on their current operating margins.
Also of interest, he states that, in services, public sector outsourcing opportunities are taking longer to come to market and are often reduced in scale, which means the financial effect of any public sector outsourcing is not likely to be recognised until 2014.
Likewise, the companys chief executive, Paul Sheffield, adds that, "the next 18 months will remain challenging as external macroeconomic factors weigh heavily on the public sector and the confidence of the private sector to invest. We will, however, continue to focus on those markets where we see the most potential for future growth."
Despite the above Kiers Board has announced a 15% increase in the interim dividend, to 21.5p. Kier expects to maintain a one third:two thirds split in its dividend payments this current financial year.
As of 09:29am shares of the firm are falling 4.63% to the 1,420p mark, and in the process erasing a large part of this years gains.
AB
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