Shareholders to receive payment in May as company prepares to rejoins FTSE 250
Kier will pay ts first dividend since Andrew Davies became chief executive five years ago when it hands shareholders a payment at the end of May.
The last dividend was announced in March 2019 – a month before Davies took the top role – but the firm has parked payments ever since as it took steps to fix its balance sheet and crippling debt pile.
At one stage, average month-end debt was up at £436m prompting Davies into a restructuring which saw the sale of its Kier Living housing arm, an equity raise and a cost-cutting programme which saw more than 1,700 jobs go.
But the firm has announced it will pay shareholders 1.67p a share and Davies, who in his first set of full-year results presided over a £245m pre-tax loss, admitted: “I’ve never paid a dividend here. It’s good news, it reflects a strong and confident company. We’ve done what we’ve said we’d do.”
Kier will rejoin the FTSE 250 list of quoted firms later this month and Davies added: “The reaction to that has been great and slightly unexpected. Our teams have been thrilled by it, pride in the company matters.”
The firm, which also completed a refinancing for the next five years last month, said average month-end net debt for the six months to December 2023 was down 44% to £136.5m.
Davies said the firm would continue to make inroads into the number but added Kier was increasing the amount of investment it would make into its property business and had money for acquisitions of the kind which saw it pay £9.4m for collapsed firm Buckingham’s rail arm last September.
“We want to deliver a strong balance sheet and be able to invest capital in the business,” Davies said.
Davies said a likely general election this year wouldn’t make too much difference to the firm’s workloads. “Whoever gets into power, the basic need is still there. We need to upgrade UK infrastructure.”
Interim turnover was up 22% to £1.9bn with pre-tax profit up 6% to £27m. A note from broker Investec said it expected Kier to post turnover of £3.8bn this year, adding the firm would breach the £4bn mark in 2025.
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