Morgan Sindall profits surge in first half of 2017
Morgan Sindall has reported a 44% jump in pretax profits in the first half of 2017 as it doubled its construction margin.
For the six months to 30 June 2017, the group made a pretax profit of £23.1m on revenue up 14% to £1.3bn.
Growth in its fit-out arm and profit recovery across its construction and infrastructure operation are cited as reasons for the improved results.
The company’s Construction & Infrastructure division improved its profit margin to 1.1% this year from 0.5% last year by better selection of work to take on.
This resulted in operating profit of £7.6m for Construction & Infrastructure, up 138%, on revenue of £694m, up 13%.
Revenue for its Fit-out division was £339m, up 15%, while operating margin hit 4.3%, compared to 2016. Two-thirds of the company’s fit-out work is in London.
Chief executive John Morgan said: “This is a strong set of results, driven by another period of margin and profit growth in Fit-out and further progress on margin recovery in Construction & Infrastructure.
“Reflecting our overall profit performance, our strong balance sheet and cash performance, and our confidence in the quality of our business, we are increasing the interim dividend by 23% to 16p per share.
“With the current trading patterns in Fit-out and the forward visibility provided by the size and quality of its order book, together with further margin improvement in Construction & Infrastructure and an increase in scheme completions in partnership housing and urban regeneration, we are confident of another strong performance by the group in the second half.”