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Kier ‘resilient’; Next suffers fall; Ted Baker up

Keir Group

Building work at Glasgow School of Art

Kier Group

The construction company reported a 12% rise in pre-tax profits to £46.3 million for the half year despite a slight dip in revenue.

Haydn Mursell, chief executive, said: “Today’s results reflect the ongoing financial and operational discipline employed across the group and the strength of our flexible, integrated business model.

“The group has a balanced portfolio of businesses and market leading positions in regional building, infrastructure and housing. Our continued focus on simplifying the portfolio and working with clients in a collaborative way is delivering further growth opportunities. Our clients recognise this approach as a key differentiator when working with Kier.

“The group’s breadth provides some resilience against economic uncertainty and we continue to shape Kier to focus on our core competencies. We are encouraged by the pipeline in the Property and Residential businesses and our healthy order books of approximately £9bn in the Construction and Services businesses. We remain on course to deliver our expectations for the full year and we are well positioned to achieve our Vision 2020 goals.”

The company announced that Phil White will retire as chairman and will be succeeded by Philip Cox, who is the chairman of Drax Group. 

Brian McQuade, managing director of the Scotland and north-east England arm of Kier’s Construction division, said: “We’ve performed well this year, increasing our framework and tender wins and taking a steady approach to growth and securing a strong pipeline of activity.

“Importantly, our commitment to the Scottish construction sector goes beyond our solid business operations.  We recognise the skills shortage affecting the entire construction industry and we are increasing awareness of this diverse and hugely rewarding sector by working with a number of schools, industry bodies and local suppliers throughout the country to attract and retain more young people into construction.”

Shares edged up 0.72% in early trading after it unveiled an order book of approximately £9bn reflecting strong pipeline conversion in regional building and highway services. The group has also established a new joint venture with CKH Developments, a housing association and care services provider which principally operates in the east of England. 

Financials

·         Order book of approximately £9bn reflecting strong pipeline conversion in regional building and highway services;

·         Forecast revenue in Construction and Services 100% secured for year to June 2017; approximately 70% secured for year to June 2018;

·         Underlying operating profit of £56.5m, 4% organic growth on 2015;

·         Net debt of £179m ahead of expectations and expected to be maintained at 1x EBITDA for the full year;

·         Portfolio simplification;

·         Profit on disposal of Mouchel Consulting of £39m;

·         Provision for winding down of the Caribbean operations and final account negotiations of £33m;

·         Basic earnings per share of 38.9p (December 2015: 34.9p), up 11%, in line with Vision 2020 goals;

·         Interim dividend of 22.5p up 5%; and

·         On track with Vision 2020 goals.

Next 

Next

High street fashion chain Next has sufferd its first fall in annual profit for eight years and warned of “another tough year ahead”.

Pre-tax profit dropped 5.5% from £836.1m to £790.2m last year.

It had already warned profits would fall and today said shoppers were spending less on clothing.

Sales at Next’s stores fell 3% to £2.3bn while its online and catalogue business saw sales growing 4% to £1.7bn.

Next chairman John Barton said: “Trading conditions in the year ahead will continue to be tough, however I believe that by focusing on our core strengths, as we did during 2008, we will see Next emerge from this period stronger than before.”

Ted Baker

Profits at retailer Ted Baker rose 4.4% to £61.3m in the year to 28 January.

Ray Kelvin, chief executive, said: “I am pleased to report another good year of progress in Ted Baker’s expansion as a global lifestyle brand. We have continued to trade well and develop despite a backdrop of on-going external challenges across our global markets. This success reflects the strength and appeal of the brand as well as the outstanding quality of our collections.

“Our Spring/Summer collections have been well received and we have a clear strategy for continued growth across both established and newer markets. This is underpinned by controlled distribution across channels as well as the design, quality and attention to detail that are at the core of everything we do.

“The success of the Ted Baker brand is testament to the skill and talent of our commitTED teams across the globe. I would like to take this opportunity to thank them for their hard work during the year. The Group’s business model as well as the strength of the brand, our team and collections support confidence in Ted Baker’s further development and growth.”

Highlights:

2017

2016

Change

Group Revenue

£531.0m

£456.2m

16.4%

Profit Before Tax and Exceptional Items

£65.8m

£58.7m

12.1%

Profit Before Tax

£61.3m

£58.7m

4.4%

Adjusted EPS

114.0p

100.6p

13.3%

Basic EPS

105.7p

100.6p

5.1%

Total Dividend

53.6p

47.8p

12.1%

 

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