Kier Group profit down but orders steady

UK contractor Kier Group posted pre-tax profits of £27 million (€31 million) for the first half of its 2013 financial year up to 31 December, 2012, a drop on 2011 figures of £34 million (€39 million).

Total revenue for the period also declined to £976 million (€1.1 billion), down from £1 billion (€1.2 billion) at the same time in 2011.

However, order books remained steady with the construction segment holding a backlog of £2.1 billion (€2.4 billion), down slightly on 2011’s £2.2 billion (€2.5 billion), while the services backlog remained balanced at £2.1 billion (€2.4 billion). Keir said it secured £800 million (€930 million) of awards during the first half.

Kier’s property division saw its pipeline nearly double from £700 million (€810 million) in 2011 to £1.3 billion (€1.5 billion) as at 31 December 2012. The group attributed this growth in part to the development of affordable housing.

“Our three divisions create a well-balanced business model, which coupled with our strong balance sheet, will continue to underpin our future performance. As we are exposed to today’s difficult environment, particularly in UK building, we are taking steps to restructure the business to reflect the scale of future opportunities. This restructuring will continue through the second half of the financial year,” commented Paul Sheffield, chief executive of Kier.

“Government announcements over the last year regarding investment in infrastructure and repairs and maintenance are positive for our business and we are well placed to benefit from those initiatives over the medium term,” Mr Sheffield added.