Morgan Sindall’s profits fall

Morgan Sindall reported a 16 per cent drop in its first-half adjusted pre-tax profit, after recording a weak performance at its largest construction and infrastructure division.

The company said it looks to the future with cautious optimism.

The British construction group said challenging market condition are expected to impact margins, but it was confident of meeting its full-year expectations.

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The company, which as of February had a 50 per cent exposure to the public sector, added it was shifting its operations from the public to private sector to combat the impact of UK government spending cuts.

Growth in Britain’s construction industry was broadly steady in July, however it faces a challenging environment over the coming months which is likely to limit growth prospects.

Morgan Sindall, which snapped up the bulk of social housing services group Connaught’s troubled assets last year, said its forward order book stood at £3.5bn as on June 30.

January to June adjusted pre-tax profit was down to £19.5m from £23.1m last year. Operating profit at its construction and infrastructure division declined 22 per cent to £9.5m.

Revenue was up 11 per cent to £1.08bn.

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Morgan Sindall shares, which have shed 13 per cent of their value in the last six months, closed at 617.5 pence on Friday on the London Stock Exchange.

Morgan Sindall’s businesses include the affordable housing, regeneration and maintenance specialist Lovell and urban regeneration and property development company Muse Developments, which have offices in Leeds.

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