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Carillion growth despite recession

Contractor Carillion has grown its revenue, margin and profits in its full-year results, published today.

Revenue increased slightly from £5.2bn in 2008 to £5.4bn in 2009, but the company’s margin grew from 3.7% to 4%, boosting underlying profits by 16%, from £157.5M to £182.2M.

Carillion chairman Philip Rogerson said: “I am delighted to report that Carillion achieved its objective of delivering materially enhanced earnings in 2009, despite challenging market conditions. In view of the wider economic environment, we expect market conditions to remain challenging in 2010. 

“However, our performance has demonstrated that the Group has a resilient business mix, including strong international businesses, a substantial high quality order book, a good pipeline of contract opportunities, good cash flow and a strong balance sheet. Consequently the Group continues to be well positioned and we believe that we will make further progress in 2010.” 

The company also turned borrowing of £226.7M in 2008 to net cash of £24.9M this year, from the sale of two ‘non-core’ businesses - Enviro and its external IT services, and four PPP investments.

Expansion into Abu Dhabi and Oman strengthened its Middle East operation, which now contributes a little over one-fifth of the company’s profit, at a 8.5% margin.

The company’s order book fell, from £20.4bn in 2008 to £17.7bn in 2009, “due to PPP equity sales and non-core business disposals”.

Carillion shares initally rose sharply, before falling back to 1.5% below its opening price in early trading.

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