Construction division hit worst with expected revenue reduced by 14.6%

Kier Group saw its group revenue fall to 拢989m in the six months to 31 December 2009, from 拢1.1bn the same period a year ago.

Total revenue for the group for this period fell from 拢1.1bn in 2008 to 拢1bn in 2009.

The group revealed the news in its interim results. Despite this, it said a 20.8% rise in its pre-tax profits in the six months to 31 December 2009, compared with last year, increasing from 拢26.4m in 2008 to 拢31.9m in 2009.

The group said its construction division in particular had taken a hit, with expected revenue reduced by 14.6%, to 拢678.3m, compared with 拢794.2m in 2008. This was largely due to a reduction in private sector UK contracts, together with a decline in our activities in Dubai and Romania.

Operating profit in this division fell from 拢19.0m in 2008, to 拢16.9m, and cash levels also decreased to 拢397.8m at 31 December, compared with 拢410.0m in 2009.

However, the group said its order books for its construction and support services saw a rise from 拢3.7bn in 2008 to 拢4.5bn.

our order book has grown and Kier is on over 50 construction framework agreements

John Dodds

Meanwhile its net cash increased by almost 拢48.5m - from 拢82.m at 31 December 2008 to 拢130.7m in December 2009.

Commenting on the results, chief executive John Dodds admitted having concerns on how the general election might impact on the industry.

鈥淭he uncertainties surrounding the forthcoming general election together with the public sector deficit give rise to concerns over the future levels of public sector spending,鈥� he said.

鈥淣otwithstanding that, our order book has grown and Kier is on over 50 construction framework agreements, both public and private, which provide comfort that we will grow our market share whilst delivering value to our clients."

Dodds is due to step down from the board when he retires at the end of March.

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