Morgan Sindall hails record H1, lifts medium-term targets for two units

(Sharecast News) - Morgan Sindall backed its full-year expectations on Thursday as it posted record half-year results and lifted medium-targets for two of its divisions. In the six months to the end of June, adjusted pre-tax profit rose 21% from the same period a year earlier to £116.1m on revenue of £2.6bn, up 8%. Adjusted earnings per share were 22% higher at 186.1p and the interim dividend was lifted 10% to 55p per share.

In the Fit Out business, revenue and operating profit rose 19% to £996m and £69.1m respectively, while the Construction segment saw a 47% increase in operating profit to £24.4m and an 18% jump in revenue to £742m.

Morgan Sindall said it continued to maintain its high-quality secured order book, which was £12.2bn at the end of the six months, just a touch ahead of the prior year-end position of £12bn.

The company upped its medium-term targets for the Fit Out and Construction businesses. For Fit Out, it now expects annual operating profit of between £100m and £130m, up from previous guidance of £80m to £100m. For Construction, it sees an operating margin of between 3.5% and 4% per annum, up from previous guidance of 3% to 3.5%; it continues to expect revenue of more than £1.5bn.

Chief executive John Morgan said: "Our performance continues to reinforce our track record of delivering strong revenue and growth in profits leading to robust cash generation, enabling continued investment in our Partnership businesses while also supporting strong dividend growth.

"Our Fit Out and Construction Services businesses delivered excellent results and made a significant contribution to group performance during the period, while our Partnerships businesses faced a more challenging macroeconomic environment.

"The medium-term fundamentals for Fit Out remain strong and in Construction, we have continued to benefit from ongoing government investment commitments. As a result, we have increased the medium-term targets for both the Fit Out and Construction divisions."

See latest RNS on Investegate