Morgan Sindall Chief Executive resigns

Morgan Sindall's Chief Executive, Paul Smith, has resigned following a profits warning.

Morgan Sindall's Chief Executive, Paul Smith, has resigned following a profits warning.

Stepping into the breach, Executive Chairman, John Morgan, has been appointed Chief Executive.

In a trading update the construction company warned that: "Our underlying trading for the current year is expected to be slightly below the board's previous expectations although the group will benefit from the £7m gain made on the sale of our medical property investments this year. This gain will in part offset the £10m restructuring charge that will be incurred this year."

Consensus expectations for the full year ending December 31st had been for pre-tax profits of £42.30m on turnover of £2.09bn.

The company spoke of further market deterioration in the UK construction industry since it announced its interims. It blamed on further reductions in public spending, deferred investment decisions and high levels of competition.

In response the Morgan Sindall is cutting costs, re-organising its network of offices delivering construction and its affordable housing business.

However, these organisational changes will have a one-off impact this year, estimated at £10m (including £3.5m of property related provisions). The company describes this as part of an on-going process that will have delivered £55m of annualised savings over the three-year period to the end of 2012.

One bright spot was that there appears to be good visibility of earnings with the forward order book currently standing at £3.0bn with a further £0.7bn of projects at preferred bidder stage (compared with £3.4bn order book and £0.3bn of projects at preferred bidder stage at the start of 2012).

In addition, in line with the company's strategy to increase its focus on regeneration, the regeneration pipeline has strengthened significantly to £2.1bn with a further £1.1bn of major schemes at preferred bidder stage (compared with a £1.8bn pipeline and £0.6bn of schemes at preferred developer stage at the start of 2012).

CM

Recommended

The ten highest dividend yields in the FTSE 100
Income investing

The ten highest dividend yields in the FTSE 100

Rupert Hargreaves takes a look at the companies with the highest dividend yields in the UK’s blue-chip index
23 Jan 2023
The top ten dividend stocks in the FTSE 250
Share tips

The top ten dividend stocks in the FTSE 250

The average FTSE 250 dividend yield is around 4%, but many stocks yield much more. Rupert Hargreaves picks the best FTSE 250 stocks for income investo…
17 Jan 2023
The top funds to invest in
Funds

The top funds to invest in

As market volatility and recessionary fears continue, here are the most popular funds, stocks and trusts investors are putting their money into accord…
5 Jan 2023
Investing trends to watch out for in 2023: what analysts say
Investment strategy

Investing trends to watch out for in 2023: what analysts say

What are sensible strategies for high inflationary times? We ask analysts to find out.
22 Dec 2022

Most Popular

House prices could fall 30%. Should investors be worried about a repeat of 2008?
Investments

House prices could fall 30%. Should investors be worried about a repeat of 2008?

Some analysts are predicting that house prices could fall as much as 30%, which, when compared to the fact that prices have jumped 28% since April 201…
24 Jan 2023
Will energy prices go down in 2023?
Personal finance

Will energy prices go down in 2023?

Wholesale gas prices are on a downward trajectory, but does this mean lower energy bills later this year?
27 Jan 2023
Council tax increases 2023 – how much more will you pay?
Tax

Council tax increases 2023 – how much more will you pay?

Your council tax bill will go up in April - we reveal the councils that have confirmed what this year’s increase will be.
23 Jan 2023