Kier’s full year results showed a considerable round of profits, with revenue increasing to £3.41bn
Kier’s latest results for the year to end 30 June 2023 showed a pre-tax profit increase from £94.1m to £104.8m, with profits at a statutory level significantly increasing from £15.9m to £51.9m.
The statutory profit margin settled at 1.65% for 2022/23- but when adjusted becomes 3.9%, above Kier’s 3.5% adjusted profit margin target.
This was partially attributed to net cash increasing by a whopping 2,110% to £64.1m.
Infrastrucutre drove Kier’s growth, whereas property dropped
Revenue growth seen in Kier’s results were mostly driven by the infrastructure and construction divisions, which turned over £1.71bn and £1.65bn respectively, with pre-tax profits of £58.6m and £42.1m.
The property business turnover fell to a quarter of the previous year, from £144.1m to £37.6m, although the drop in profit was softened to £1.4m by success in other areas. Similarly, corporate saw a loss of £67.1m.
After Kier’s shares experienced a high of £14 in 2017, before dropping and trading at around 70-80p in recent years, prices rose to 95.20p at 9:59 BST this morning in response to the promising full year results.
Kier’s chief exec was proud of the full-year results
Chief executive Andrew Davies said: “The group has achieved considerable operational and financial progress over the last two years. This is reflected in the significantly improved financial performance of the group over the last year. It is testament to the hard work and commitment of our people who have enhanced our resilience and strengthened our financial position in line with the objectives set out in our medium-term value creation plan.
“Our order book remains strong at £10.1bn and provides us with good, multi-year revenue visibility. The contracts within our order book reflect the bidding discipline and risk management now embedded in the business. I am also particularly pleased to report, the group significantly improved its year-end net cash position and has confidence in sustaining this momentum going forward.
Kier will resume paying dividend payments
“The new financial year has started well, and we are trading in line with our expectations. The group is well positioned to continue benefiting from UK government infrastructure spending commitments and we are confident in sustaining the strong cash generation evidenced this year. This, combined with our focus on operational delivery, gives the group a clear line-of-sight to significantly de-lever. As a result, the group intends to resume dividend payments during FY24, with the first dividend to be declared alongside our interim results.”
Speaking on Kier’s recent takeover of Buckingham’s rail division, the company said that net cash forecasts will be unaffected, whereas turnover will grow by £50-£70m.
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