Last week brought welcome news for the quoted companies in the industry, as the construction and building materials index rose modestly, about 1% to 3776.
The best performer overall was Kier, which has bucked the downward trend among housebuilders by reporting a strong set of annual results for the year ending 30 June.
Shares in the company were up almost 16% to 1075p at the close of the week’s trading on Friday afternoon, after it announced a 40% increase in group pre-tax profit to £60.4m. Operating profit within its housing division rose more than 7% to £34.1m – an impressive achievement given the poor results emerging from most volume housebuilders.
Chief executive John Dodds was unsurprisingly in good spirits on Thursday after the results were announced. He will be patting himself on the back for his sound strategy of securing forward sales, being geographically diverse and having a strong management team.
Kier’s share price has risen steadily over the past year, and the City’s faith was rewarded last week.
Redrow also had reason to be positive last week. Shares in the company rose 3% to 431.25p on the back of a good set of annual results. Pre-tax profit increased 14% to £141m at a time when all in the housing sector are conceding that the market is weak. Redrow gave further hope to the City by increasing its dividend 20% to 10.8p, and pledging to raise it by the same level next year.
It was a fair week last week for contractors, with a rise of almost 3% to 149p for Mowlem, defying the trend of recent weeks. The good news was short-lived, though, as Mowlem returned to misery this week when it announced a £70m hit on contracts.
Alfred McAlpine also had a decent week, up 3% to 370p.
The All-Share rose roughly in line with the construction sector, up 1% to 2714.
In the support services sector, consultant WSP rose 7% to 357p, still riding high from a strong set of interim results two weeks ago.
Pre-tax profit at the company rose one-third to £8.8m.
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Angela Monaghan is business editor