Fit-out and rising margins drive Morgan Sindall growth
Pre-tax profit at Morgan Sindall surged 29% to £29.9m in the first half of 2018 as the contractor's growth was driven by "excellent performance" from its fit-out division and significant margin improvement in its construction arm.
Group revenue for the six months to 30 June 2018 increased by 9% to £1.4bn.
The firm's fit-out division increased its profit by 29% to £18.8m. Revenue was up by 26% to £426m.
Meanwhile, Morgan Sindall's construction and infrastructure arm recorded an operating margin up to 1.7% (compared to 1.1% in the first half of 2017). Revenue fell by 5% to £662m but operating profit in the division increased by 49% to £11.3m.
The firm's construction order book as at 30 June 2018 stood at £1.76bn, while its fit-out order book is £528m.
Overall, the group committed order book stands at £3.6bn, down 6% on the same period a year ago.
Profit was also up at its Urban Regeneration business, rising to £6.1m from £2m in the same period a year before. But profit at its Partnership Housing division fell to £4.6m, down from £5.5m in the same period a year before as a result of construction cost overruns.
Chief executive, John Morgan said: "Fit-out and construction & infrastructure have both continued to deliver margin and profit growth, which has been complemented by a good performance from Urban Regeneration. There remain a significant number of opportunities in regeneration and our strong balance sheet and cash position leave us well-placed to invest further in this key strategic area.
"Based upon its current trading patterns and order book visibility, the second half outlook for Fit-out is very positive and as a result of this, the Group is on track to deliver a result for the year which is slightly ahead of its previous expectations."