Highways division boosts Kier’s full-year results

Kier Group plc has celebrated positive full-year results, underpinned by the performance of its highways division.

The property, residential, construction and services group said it had maintained its position as the UK’s leading provider of strategic maintenance and management and had mobilised three Highways England contracts.

It reported revenue to 30 June of £4.27bn, up 5%, and an underlying profit from operations of £146m, up 3% after £7m interest and tax cost from joint ventures.

Non-underlying items included a charge of £75m (previously predicted to be £73m), including the closure of the Caribbean and Hong Kong operations and the sale of Mouchel Consulting.

Chief executive Haydn Mursell said: ‘Our underlying performance for the year was good. Having simplified our portfolio, the Group is more focused and able to pursue its growth ambitions in our three core markets; building, infrastructure and housing, which now represent 90% of the group’s revenue and profit. We continue to invest in the business to improve our operational efficiency, providing a robust platform on which to take advantage of the strong long-term fundamentals in these core markets.

‘Our construction and services order books of £9.5bn, together with our roughly £2bn property development and residential pipelines, provide good long-term visibility of our future work. This visibility, coupled with our healthy balance sheet, provides us with confidence of achieving our Vision 2020 strategic targets.’

During the year, Kier mobilised the following contracts with Highways England :

·         A 15-year £140m repair and maintenance contract for Area 13 covering Cumbria;

·         A two-year £50m maintenance services contract for Areas 6 and 8 covering East Anglia and the East of England;  and

·         A five-year £40m design service contract for Areas 1 and 2 covering the south-west.

The firm said the local authority sector remains active, ‘albeit with budget pressures, which is resulting in new opportunities as clients look for new ways to deliver services’.

Local authority contracts mobilised in the financial year include a one-year £40m extension to Kier’s Lincolnshire local authority contract, a two-year £27m extension to its Harrow Highways contract and a five-year £270m extension to the company’s Suffolk Highways contract.

Kier said new opportunities include three new Smart Motorway projects covering design and survey work on the M20 and M23 and an additional project on the M6 as part of the collaborative delivery framework for Highways England.

 

 

 

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