Headline figures don't tell the whole story for Keller's (KLR) first-half performance. In fact, stripping out exceptional items left operating profits up by 6 per cent at £37.7m. Numbers for the prior year were affected by a £29m provision relating to a major contract dispute.
Trading conditions for the ground engineering specialist remained patchy, with the exception of its major market in North America, where turnover rose 11 per cent to £416m. In the US, public and private construction spend is up. This helped to drive operating profits there up by over a third to £28.4m and margins from 5.5 per cent to 6.8 per cent, despite tough trading in Canada as a result of low investment in the oil sands market.
In Europe, Middle East and Africa, revenue rose slightly after adjusting for currency movements, while operating profits jumped from £2.7m to £7m, thanks to a strong first half in Africa. Delays in starting work on Singapore's Changi airport were behind the drop in Asian operating profits from £3.6m to £0.6m.
With the order book up 5 per cent from a year earlier, chief executive Alain Michaelis expects revenue to grow in the second half, and also hinted that the group is well placed in a number of tendering projects.
Analysts at Investec are forecasting full-year normalised pre-tax profits of £95.7m and EPS of 83.6p (from £85.1m/74.2p in 2014).
| KELLER (KLR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,054p | MARKET VALUE: | £757m | |
| TOUCH: | 1,051-1,054p | 12-MONTH HIGH: | 1,105p | LOW: 742p |
| DIVIDEND YIELD: | 2.4% | PE RATIO: | 33 | |
| NET ASSET VALUE: | 462p* | NET DEBT: | 51% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 788 | 4.9 | -8.3 | 8.4 |
| 2015 | 756 | 31.6 | 27.9 | 8.8 |
| % change | -4 | +545 | - | +4 |
Ex-div: 13 Aug Payment: 4 Sep *Includes intangible assets of £172m, or 240p a share | ||||
