Kier has secured all expected construction revenue for the year to 30 June 2011 - but admits housing margins remain “challenging”.
In a statement to the Stock Exchange this morning, the firm said it was trading in line with expectations, with strong order books in both the Construction and Services divisions.
In construction, it said its presence on more than 60 public and private sector frameworks, and a “collaborative approach” to bidding put it in a strong position to secure more work. It said operating margins remained above 2 per cent.
It has won £600m of construction work since the start of 2011, securing all of this financial year’s targeted revenue and 80 per cent of next’s.
Kier said its Services division had traded in line with our expectations, maintaining a £2bn order book, and posting a 4.5 per cent operating margin.
Its Developments business remained a key generator of integrated opportunities for the group, Kier said, and was very active during the period.
The Partnership Homes division continued to deliver on its strategy with £50m of framework successes and scheme completions in the period.
Kier is selling homes from more sites which keeps it on track for results to be “second-half biased”. The firm said it remained on track for more than 500 unit sales during the current financial year, but that with sales coming from land acquired at historic prices, margins were still challenging.
It said it continued with a strategy to reduce cash investment in the homes division by developing its existing land bank of homes for sale, or disposing of land as the opportunity arises.
It iscurrently progressing the sale of approximately 700 plots of land, spread throughout the country, to a number of buyers and expected to complete these by the year-end.
Kier said it had a strong balance sheet, an excellent track record of service delivery and very talented and capable people, all of which kept it on track to deliver a good performance this year.