Kier Group: Order book hits £10.7bn as chief heralds ‘disciplined growth’
Kier Group’s half-year order book has risen 6 per cent to £10.7bn, after the construction firm secured a number of major infrastructure deals.
The London-listed construction, services and property group said “bidding discipline and risk management” had driven the year-on-year growth, with the group also near halving its debt pile.
Recent contract awards include a £30m contract with the energy firm Evolve for a gas pipeline in Northern Ireland, four education projects worth a total of £150m, and the contract to deliver a new houseblock for the Ministry of Justice at HMP Elmley worth over £100m.
Average month-end net debt sat at £140m, a significant reduction on last year’s £243m and against a challenging macroeconomic backdrop for the construction sector.
Andrew Davies, chief executive, said: “Kier has made a good start to the year, in line with our expectations. I am particularly pleased with the progress we are making on reducing debt, which has resulted in the Group materially deleveraging its balance sheet in the first half.”
“We have achieved this through disciplined growth as well as our unstinting focus on operational excellence, cash management and cash generation. Kier remains well positioned to continue benefiting from UK Government infrastructure spending commitments and this gives the Board every confidence in delivering our medium-term value creation plan.”
After a strong year, analysts anticipate the Manchester-based group will pay out its first dividend in nearly half a decade in 2024.
Kier said the “continued resilience in trading, order book security and ongoing strengthening of the balance sheet” gave it confidence in resuming dividend payments in the current financial year.
In September, Kier acquired the rail assets of the now-collapsed Buckingham Group, saving 180 jobs. It said the acquisition had now been “successfully integrated into the Group’s Transportation business.”
Kier will publish its half year results on 7 March 2024.