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Carillion's dividend looks solid

RESULTS: Markets could prove challenging for Carillion in 2012, but the group is underpinned by a robust order book, promising international exposure and a strong balance sheet
February 29, 2012

This year is expected to hold challenges for construction and support services group Carillion. Nevertheless, the business starts 2012 with a robust order book and a growing pipeline, all of which helps underpin the attractions of its high-yielding shares.

IC TIP: Buy at 337p

While last year's revenues fell marginally, reflecting the acquisition of Eaga and the scaling back of UK construction, a substantial boost to underlying operating margins from 4.2 per cent to 4.7 per cent meant a 13 per cent rise in underlying pre-tax profits to £212m. Meanwhile, the order book was steady at £19.1bn and, encouragingly, given fears about the economic outlook, the contract pipeline rose 29 per cent to £33bn.

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