Headline figures for Keller (KLR) were hit by exceptional items and unfavourable currency shifts last year. Strip these out and the ground engineering specialist grew underlying operating profit by 30 per cent to £92m, while operating margins were up at 5.8 per cent.
Exceptional costs of £54m were booked in relation to a disputed contract completed in 2008. Since the year-end, this dispute has been settled, but it is not clear yet what the eventual cost will be. The provision does not take into account any potential recoveries under its insurance policies.
Trading was strong, with all four of the group's regional businesses registering increases in turnover. Revenue in the US and Canada, which account for around half of group turnover, rose by 11 per cent to £775m, reflecting a steady increase in US construction activity. The UK division completed major projects on Crossrail and Victoria Station.
Cash generation was also extremely strong, at 117 per cent of cash profit. As a result, net debt fell from £144m to £102m despite an increase in net capital expenditure from £42.6m to £61m.
Analysts at Peel Hunt are forecasting adjusted pre-tax profit for the current year of £101m, giving EPS of 95.9p, but may have to downgrade these numbers as key currencies (euro, Australian and Canadian dollars) have continued to weaken.
| KELLER (KLR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,049p | MARKET VALUE: | £748m | |
| TOUCH: | 1,046-1,049p | 12-MONTH HIGH: | 1,263p | LOW: 742p |
| DIVIDEND YIELD: | 2.4% | PE RATIO: | na | |
| NET ASSET VALUE: | 481p* | NET DEBT: | 30% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 1.10 | 17.8 | 44.0 | 22.8 |
| 2011 | 1.20 | 21.9 | 24.8 | 22.8 |
| 2012 | 1.30 | 43.5 | 45.9 | 22.8 |
| 2013 | 1.44 | 52.0 | 43.2 | 24 |
| 2014 | 1.60 | 28.2 | -4.2 | 25.2 |
| % change | +11 | -46 | - | +5 |
Ex-div: 12 Mar Payment: 8 Jun *Includes intangible assets of £184m, or 257p a share | ||||
