Morgan Sindall has bucked the recent trend among major contractors with a positive trading update predicting profits ahead of City expectations.
The news will be a welcome boost for the sector still reeling from Carillion’s recent profit warning and contract write downs by Skanska.
Strong trading in the first half at Morgan Sindall has been driven primarily by margin and profit growth in Fit Out and margin improvement in Construction & Infrastructure.
Morgan Sindall said: “As a consequence, the half year results for the Group are expected to show profit before tax in the region of £23.5m, reflecting growth on the prior year of around 45%.
“The cash performance has again been strong, with average daily net cash for the first half of £132m. The net cash as at 30 June was £97m.”
“The performance of Fit Out in the first half, its current trading patterns and the forward visibility provided by the size and quality of its order book, indicate an out-turn for the year for Fit Out which is much stronger than previously expected.
“Taken together with the expected margin improvement in Construction & Infrastructure and the second half weighting to Partnership Housing, the Group now anticipates that its 2017 full year results will be significantly ahead of its previous expectations.“
