Pre-tax profit likely to be flat, but contractor says order book up to a record 拢4.2bn

costain

Costain expects turnover for 2018 to come in lower than the previous year, with pre-tax profit likely to be flat.

The contractor said it would meet its expectations for the year to the end of December 2018, with turnover around 拢1.6bn, down around 7%, and a pre-tax profit of 拢49m.

Divisional operating margins are believed to be in the region of 4% to 5%.

Costain, which will announce its annual results in March, said it ended the year with a record order book worth 拢4.2bn, up 8%, while its preferred bidder position stood at around 拢600m, up 50% year-on-year.

Year-end cash was down 38% at 拢110m, with the reduction from 2017鈥檚 鈥渆xceptionally high level being due to the timing of receipts in that period鈥�, and an average month-end net cash balance of around 拢77m, down 20%.

Andrew Wyllie, Costain鈥檚 chief executive, said 2018 had been 鈥渁nother year of progress鈥� for the group, while it 鈥渃ontinues to be involved in a number of major regulatory-driven procurement processes鈥�.

City observers were encouraged by the trading update, notably around the group鈥檚 order book which is believed to be 90% repeat business, and with no nasty surprise in the announcement Costain鈥檚 shares were trading up more than 7% this morning at 348p.

Costain will announce its results for 2018 on 6 March.

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