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Morgan Sindall posts 56% profit hike

Morgan Sindall

Morgan Sindall increased its pre-tax profit by 56% in 2017, meaning the company has nearly doubled its profitability in just two years.

Profit for the year stood at £66.1M, up from £5.3M in 2016 and £34.3M in 2015.

An impressive set of figures from the construction and infrastructure firm also showed full year revenue of £2.79bn, up 9% on last year’s figure of £2.56bn.

The firm’s order book was up 6% to £3.8bn, while operating margin in its core construction and infrastructure divisions stood at 1.5%, up from 0.7% in 2016.

Year-end net cash was £193M, slightly down on last year’s equivalent. However, average daily net cash showed a marked improvement, jumping to £118M from £25M in 2016.

Chief executive John Morgan said: “These strong results are evidence of the significant operational progress being made across the group and are a testament to the high quality and commitment of our people.

“Our positive cash generation and increase in average net cash in the year has further strengthened our balance sheet and provides us with the flexibility to invest in our regeneration activities whilst allowing us to continue being highly selective with bidding in our construction activities.

“Looking ahead to 2018, we expect continued margin progression in construction and infrastructure, another strong performance from fit out, further growth from urban regeneration and partnership housing and positive contributions from property services and investments.”  

Morgan Sindall’s share price climbed 3.9% on trading this morning (Thursday), with investment bank Jefferies rating it as a ‘buy’.

In a commentary on the firm’s financial results, Jefferies said: “Cash performance is very strong and there are no exceptional costs to be seen in the accounts. Morgan Sindall is currently operating on a higher plane than others in the sector.”

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