Morgan Sindall sees record revenue but fall in profits to meet the Government’s building safety pledge

However, chief executive John Morgan said underlying performance remained strong with revenue rising 12 per cent to a record £3.6bn.

Adjusted profit before tax was up seven per cent to £136.2m.

Construction and infrastructure profits were down by 10 per cent due to rising energy prices, supply constraints on certain materials and increased trade and labour costs.

Mr Morgan said there were encouraging signs for inflation going forward.

“There are early signs that inflation, particularly labour inflation, has plateaued and is starting to fall in some areas,” he said.

"We look forward with optimism and although it is still early in the year, we’re well-positioned to deliver a result for 2023 which is in line with our current expectations.”

The firm’s Yorkshire operations including a £15.1m contract to refurbish an existing bank headquarters to create the Leeds Mathematics School, a 240-place sixth form college, for the Department for Education.

It also completed a £5.6m two-storey teaching block at Horsforth School in Leeds which provided 365 additional places, and the fit out of the School of Health at Leeds Beckett University.

The group’s Urban Regeneration division began a number of new schemes and phases.

Construction began in 2022 on One City Park, a 56,000 sq ft office building in Bradford city centre and also Forge Island, a new leisure destination in Rotherham town centre that will provide a cinema, Travelodge hotel and six independent restaurants.

Completions in the year included the final 100,000 sq ft units at Logic Leeds, bringing the 15-year regeneration scheme to an end.

Partnership Housing increased its portfolio of long-term joint ventures during 2022. The division was selected as preferred bidder by Scarborough Council for its 30-year ‘Better Homes’ joint venture, with initial sites identified to deliver over 700

new homes in the Scarborough area.

Compendium Living, the division’s joint venture with The Riverside Group, began work during the year on a further phase at Ings in Hull.

Meanwhile, the group said it had made ‘considerable’ progress with its carbon offsetting projects.

Since the year end it has also taken on two other offsetting projects, including a peatland restoration programme to restore over 300 hectares of blanket bog in the Northern Pennines AONB and the Yorkshire Dales National Park.

Looking ahead, Mr Morgan said: “With the more challenging economic backdrop, our strong balance sheet including our substantial net cash position provides us with confidence and enables us to continue operating efficiently and effectively.”