Revenue growth fails to boost profits at Morgan Sindall
PRE-TAX profits have fallen by £1.7m at construction firm Morgan Sindall Group despite a rise in revenues of £105m.
In its half-year results for the period ended June 30,2011, the group has seen year-on-year pre-tax profits drop to £16.7m while group revenues have increased from £982m to £1.087bn.
It ended the period with a cash balance of £65m, down 53% on the same period last year with £138m.
In Morgan Sindall, its Rugby-based construction and infrastructure division, operating profit dropped year-on-year from £12.2m to £9.5m while revenues climbed by £5m to £617m.
It said market conditions remained very competitive in the sector which forced a drop in operating margins from 2% to 1.5%.
The statement added it was well placed to exploit opportunities in the aviation, rail, energy distribution and commercial/industrial sectors with an order book of £1.9bn, down from £2.1bn in 2010.
In Lovell, its Tamworth-based affordable housing division, operating profit was up 20% to £8.3m and revenues rose from £173m to £228m.
Revenue growth had been driven by increases in response maintenance work following acquisitions in 2010 and new build social housing, it said.
Operating margin dropped from 4% down to 3.6%, which was due to a changing mix of work, the statement added, with an order book of £1.5bn, down from £1.4bn in 2010.
Click through to read more property stories.
