Chief executive Colin Busby said Kier's mix of construction, housing and services would continue to improve profitability.
He said: "There is no doubt demand is strong in both the construction and housing markets. The prospects for further growth in the current year are encouraging, and I am confident that the integrated business model we have created will continue to drive up returns."
Kier, which concentrates on low-risk contracts, saw its regional construction turnover increase 23% to £732.4m. Busby said growth was "outstanding" and claimed the division had become the "contractor of choice" for projects worth up to £15m.
There is no doubt demand is strong in both the construction and housing markets
Colin Busby, chief executive, Kier
He said that although about half of the group's work was now partnered, Kier would still look to participate in the competitive tender market.
Kier has also grown its support services division, with turnover rising 64% to £59.8m. Overall, the construction and services division's operating profit rose 71% to £11.1m, while turnover increased from £937.4m to £1.12bn. Operating margins, among the lowest in the sector, increased from 0.7% to 1%.
Operating profit for the group's housing business rose 35% to £14.4m and turnover increased from £81.6m to £110.4m. The average selling price for the 733 houses sold (573 in 2000) was £150,500 (£142,300 in 2000).