Morgan Sindall met with mixed fortunes in the first half of the year. While its construction and infrastructure services divisions achieved record profits, the group's urban regeneration side slipped into a £1.1m loss (£5.6m profit) due to a weak commercial property market. Profits also fell sharply in its fit-out operation, which provides interiors for the hotel, leisure and retail industries.
The group's construction division grew operating profits by almost 40 per cent to a record £5.7m, underpinned by public sector work for education and health facilities. Notable contracts won in the first half include projects for Reading University (£49m), University of Brighton (£18m) and two schools contracts in Liverpool worth £37m. The division had an order book of £696m at the end of June, since when it has been named a preferred bidder on a £100m PPP contract. And supported by investment in the water, energy, rail and air transport sectors, Morgan Sindall's infrastructure services business reported a 22 per cent rise in operating profits to £9.3m.
Affordable housing also put in a resilient performance, with turnover rising slightly to £178m on the back of demand for refurbishment work and new social housing. Profits, though, slipped from £8.8m to £7.1m, mainly as a result of weakness in open market housing sales.
RBS is maintaining its forecast for full-year pre-tax profits of £50.5m and EPS of 81.5p (£62.3m and £106p in 2008).
| MORGAN SINDALL(MGNS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 627p | MARKET VALUE: | £275m | |
| TOUCH: | 623-627p | 12-MONTH HIGH: | 749p | LOW: 380p |
| DIVIDEND YIELD: | 6.7% | PE RATIO: | 7 | |
| NET ASSET VALUE: | 447p* | NET CASH: | £89m | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 1.24 | 28.6 | 50.1 | 12.0 |
| 2009 | 1.14 | 20.5 | 34.6 | 12.0 |
| % change | -8 | -28 | -31 | - |
Ex-div: 26 Aug Payment: 18 Sep *Includes intangible assets of £184m, or 421p a share | ||||
