Contractor notes easing in market conditions despite continuing downward price pressure

In an interim management statement, contractor Kier Group has predicted an improvement in market conditions for housing in 2010.

Its Partnership Homes group said it was hard to predict the outlook, but that it believed “the challenging market conditions experienced over the last 12 months are beginning to ease” and that it was “well positioned to take advantage of improvements in the housing market as it recovers”.

Kier's Junction development in Glasgow
Kier's Junction development in Glasgow

It made the statement despite observing continued downward pressure on prices, which were nonetheless, it said, in line with expectations.

Kier said its construction division, of which 75% of the workload comes from the public sector, was performing well despite having a reduced order book. The firm said it was in advanced negotiation on a number of other contracts and that its order book fulfilled 80% of projected revenue to 30 June 2010.

However, the group said its developments division had achieved little sales activity during the year.