Firm says 2017 figure will beat expectations
Morgan Sindall has said strong performances from its recovering construction division and fit-out arm will help send profit for the year ahead of expectations.
The top 10 contractor said it was to deliver a full-year performance slightly ahead of its previous expectations.
It did not give a figure but had reported a 2016 pre-tax profit of £43.9m with analysts at Liberum and Cenkos reckoning the firm will turn in a pre-tax profit for 2017 of around £65m when it kicks off the reported season for quoted contractors next spring.
The firm has firmly put behind its problems on two Ministry of Defence schemes in Scotland – which saw it slump to a £15m pre-tax loss in 2015 – with the firm saying that margins are on their way to hitting the 2% target set by chief executive John Morgan (pictured, left) in the second half.
Its infrastructure arm, which carries out civils work, was also expected to see an improvement in margins in the second half, the firm added.
Fit-out was also seeing improved margins while its order book at September 30 was up 16% from the year end last year to £540m.
Some of the gloss was taken off the upbeat statement with the news that it is taking a £1m hit for getting out of insurance work for local authorities but it added that its order book at the end of September was up 5% from the year end to £3.8bn.
And it said the firm is now expected to show average daily net cash for the year in excess of £100m, up from the £75m it forecast at its interim results in August.