Contractor sees construction revenue remain flat as group highlights “good results” overall
The construction arm of contractor Interserve saw operating profit fall 24% in the first half of the year.
In the six months to 30 June 2012 the firm made a operating profit of £14.3m down from £18.7m over the same period last year.
Construction revenue in the first half of the year was £470m compared with £472m over the same period last year.
The firm’s UK construction arm was worst hit in terms of profitability with profit sliding 27% to £7.3m in the first half of the year.
However, in a statement to the city released today, the group reported an 8% jump in pre-tax profit overall for the first half of the year. The firm also reported a 3% rise in group revenue over the period to £1.2bn.
The group’s growth was driven by its support services and development arms with construction revenue remaining flat.
Support services saw revenue grow 12% in the UK and 29% abroad while construction revenue grew only 0.4% in the UK and declined 3% abroad.
Interserve said it expected revenue from construction to remain “subdued” with growth not scheduled to return until 2014.
Adrian Ringrose, chief executive of Interserve, said: “We have delivered a good set of results against a backdrop of continuing mixed market conditions.”
He added: “Our confidence is demonstrated by the board’s announcement of a further increase in dividend and reiteration of our guidance for stable performance in 2012 compared with 2011.”