Profit slump announced by Morgan Sindall
RUGBY-based construction group Morgan Sindall has seen a dramatic fall in profits – down nearly 25% compared to the same period last year.
Announcing its results for the half year ended June 30, the firm reported profit before tax of £15.4m, 24% down on the H1 2012 figure of £20.3m.
However, revenue of £1.02bn was up 2% on the previous year (HY 2012: £1bn) and the firm’s order book is up 1% from FY 2012.
The firm also reports good progress on cash management, with net cash of £40m and improved average daily net debt of £32m (HY 2012: net debt of £12m and average daily net debt of £36m).
Morgan Sindall reports an exceptional charge of £13m taken as a provision against amounts recoverable on a small number of older construction contracts.
Chief Executive John Morgan said: “The first half has seen difficult market conditions across all of our markets, with competitive pressures impacting on margins and profitability.
“The improved positive cash position, however, demonstrates the underlying strength of the business and the benefit of a sustained focus on cash management, which will remain.
“Looking ahead to the second half, overall market conditions are not expected to significantly improve. The business will continue to focus on cash management and will look to improve the order book selectively, such that it is well-positioned to take advantage of the growth and investment opportunities in its markets as they arise.”
