Contractor to focus on infrastructure and construction instead and to return £150m cash saving of move to balance sheet

Kier said it is pulling the plug on its property business and expects to return around £150m of cash to its balance sheet over the next three years as a result.

In its annual results announced this morning, the firm said it would make no new investment in new property development from next year.

The business, which is based in Kier’s headquarters at Foley Street in London, works mainly in the mixed-use and residential sectors and employs around 80 people.

Stuart Togwell - chief executive

Chief executive Stuart Togwell has revised Kier’s medium term targets upwards

Chief executive Stuart Togwell said: “It just made sense to me to put our effort into infrastructure and construction, given the volatility of the property market. We need to concentrate on where the growth is, which is infrastructure and construction.”

It is expected to take around five years for the wind down to complete with most of its work carried out in joint ventures.

Togwell said the cash saved would be returned to its balance sheet with the firm targeting an average monthly net cash position of £200m by 2029.

The firm posted its first average monthly net cash position for 13 years with £10.7m for 2026, compared to a £49.2m debt last time. The firm’s monthly net debt hit a peak in 2021 when it reached £583m.

Kier said it was updating its medium-term targets with single-digit revenue growth, an adjusted operating margin of 4%-4.5% and double-digit adjusted earnings per share growth.

The revision came on the back of a record set of results with revenue climbing 7% to £4.35bn and pre-tax profit up 7% to £84m. Operating profit in the year to June was up 4% to £119m.

Togwell said the firm had access to £200bn of future opportunities and was working on 120 frameworks with keys sectors including water, energy, defence and healthcare. “The reality is we can see this being for the next 10-15 years,” he added.

Kier said it had increased its dividend by 8% to 7.8p while a £25m share buyback was 30% complete at the year end.

The firm’s order book at the year end was up 8% to a record £11.9bn.

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