The group's half year results saw management summarising performance as "in line with expectations." The company, which divides its business into four divisions: Support Services, Public Private Partnership (PPP) projects, Middle East construction services and Construction services (excluding the Middle East), reported an 11% increase in underlying or adjusted pre-tax profit to Â£84.5 million, on the back of total group revenues which had risen by 21% to Â£2.26 billion.
Management pointed to a strong, high-quality order book and growing pipeline of contract opportunities. Total secure orders plus probable orders of Â£17.1 billion as of 30 June 2015 were reported (31 December 2014: Â£18.6 billion), whilst the firm's pipeline of contract opportunities increased to Â£40.5 billion (31 December 2014: Â£39.2 billion). A 2% increase in the half year dividend to 5.7 pence per share was declared.
- Group revenues increased by 21% to Â£2.26 billion compared to H1 2014
- Underlying or adjusted pre-tax profit rose by 11% to Â£84.5 million
- Unadjusted profit before taxation flat at Â£67.5 million
- A 2% increase in the half year dividend to 5.7 pence per share (H1 2014: 5.6 pence)
- Net group borrowing at 30 June 2015 of Â£199.6 million (31 December 2014: Â£177.3 million)
"I am pleased to report that Carillion has continued to perform in line with expectations, which reflects the actions we took during the economic downturn to position our businesses in markets where we can now achieve revenue growth, consistent with our targets for margins and cash flow. We have also made good progress with mobilising a number of major new contracts won in 2014."
The CEO noted "with a strong order book, a growing pipeline of contract opportunities and the prospect of market conditions continuing to improve, our expectations for 2015 and the medium term remain unchanged."
This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment. This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication. Non-independent research is not subject to FCA rules prohibiting dealing ahead of research, however HL has put controls in place (including dealing restrictions, physical and information barriers) to manage potential conflicts of interest presented by such dealing. Please see our full non-independent research for more information.