Morgan Sindall profits soar as margins restored

Aaron Morby 7 months ago
Share

Morgan Sindall returned to form last year with a big uplift in profits driven by strong returns at the fit-out and construction and infrastructure divisions.

Chief executive John Morgan predicts a strong year ahead as Morgan Sindall avoids the troubles of many of its rivals

Chief Executive John Morgan predicted another strong year of growth ahead as margins recover and the firm builds up its cash reserves.

The only hiccup for the group across six operating divisions was property services, which suffered a £1.3m loss after streamlining its contract portfolio.

Overall group pre-tax profit soared 46% to £65m after revenue rose 9% to £2.8bn. As a result average net cash swelled to £118m, a significant improvement of £93m on the prior year.

“Average net cash of over £100m enables us to make the right long-term decisions for the business and we don’t have to do anything short-term just for cash”.

Morgan Sindall trading divisions in 2017
Profit change Revenue change Margin change
Construction/ infrastructure £20.4m 129% £1,395m 6% 1.5% +80bps
Fit-out £39.1m 42% £735m 16% 5.3% +100bps
Property Services -£1.3m n/a £66m 20% -2% -330bps
Partnership Housing £14.1m 5% £474m 9% 3% -10bps
Urban Regeneration £10m -25% £175m 12% n/a n/a
Investments £0.5m n/a £11m n/a n/a n/a

Fit-out had a bumper year after strong work flows in London with profit jumping 42% to £39m and operating margins now passed 5%.

The construction and infrastructure division also romped ahead with operating profit more than doubled from £9m to £20m over the year.

Margins doubled to 1.5% with Morgan saying the business is now on track to meet a 2% construction and 2.5% infrastructure target.

Morgan said: “Our positive cash generation and increase in average net cash in the year has further strengthened our balance sheet and provides us with the flexibility to invest in our regeneration activities whilst allowing us to continue being highly selective with bidding in our construction activities.

“Looking ahead to 2018, we expect continued margin progression in construction and infrastructure, another strong performance from fit-out, further growth from urban regeneration and partnership housing and positive contributions from property services and investments.  

“Consequently, we are confident of another good year of progress and with this positive momentum, are well-placed to deliver a result for the year which is slightly above our previous expectations.”

Latest news

Go-ahead for £160m Leeds Monk Bridge scheme

McAlpine is on board as preferred contractor for the project
1 hour ago

Opinion: Safety fines are getting out of control

We need more effective ways to improve safety than ever higher penalties
1 hour ago

Shake-up for £2.9bn MoD hard FM contracts

Post-Carillion bid race for MoD estate and housing regional FM contracts
12 hours ago

Wates set to start on £53m Portsmouth sports centre

Contractor understood to have won contract race for new university complex
2 days ago

Lack of skilled roofers prompts Marley new launch

Easy to install roofing roll compensates for lack of skilled workers
54 mins ago

Caddick takes workforce plastic-free

Workers given aluminium drinks bottles in bid to bin single-use plastics
9 hours ago

Wates wins 7th Leeds Wellington Place job

Work will start of £35m 4 Wellington Place project next month
19 hours ago

Kier targets £50m disposals to cut £375m debt

Firm sets out debt reduction plan in robust year-end results
1 day ago

Betting Spy: Spurs to shrug off recent troubles

Tottenham can kick-start a win treble with Leicester and Crystal Palace
10 hours ago

Keltbray concrete structures boss exits

Keltbray Structures MD Gordon Dunne on gardening leave
2 days ago

141 jobs axed as M&E specialist George Birchall fails

Larger FM business George Birchall Service avoids administration
1 day ago

Morgan Sindall bags £384m London scheme first phase

Hackney scheme includes an academy, leisure centre and six blocks of flats
1 day ago

Mace confirms £180m Olympic Park East Village deal

Firm will fine-tune its 'rising factory' method on the No6 East Village project
1 day ago

Contractor trials mixed reality headsets on school site

BIM and Microsoft HoloLens used to check M&E work
2 days ago

PM pledges extra £2bn for housing associations over 10 years

Longterm funding will be made available from 2022-2029
2 days ago

Jacobs to lead Edinburgh city centre transformation plan

Team will set out plan for historic overhaul of streets and public space
2 days ago

Costain and Galliford Try fined £2.8m after worker loses toes

Massive fine after accident at Cheshire water treatment works
2 days ago

Boost your online presence – join the new Enquirer Directory

New site for suppliers and buyers will showcase their products, services and latest stories
5 months ago

Van Elle shareholders stage AGM revolt

Shareholders block board's ability to issue new shares for acquisitions
2 days ago

£100m Bristol sports arena plan at Ashton Gate stadium

Sports and convention centre will be attached to Lansdown Stand
2 days ago

Balfour Beatty raises £43m from hospital stake sale

Balfour sells 50% stake in Fife Hospital PPP
2 days ago

Kier offloads pensions unit for £3.5m

Third party pension management business administers half of all police pension
3 days ago

Willmott Dixon clinches £38m Winchester sports centre

Work to start in Spring 2019 on major leisure and sports complex
2 days ago

Architect TP Bennett reaches record turnover

Manchester office grows on back of city building boom
2 days ago

Brexit migration plan would “cripple construction”

Industry pleas ignored over need for steady flow of low-skilled site workers
3 days ago

Wates wins £16m Stockport college revamp

Work is due to start in the early new year on Wellington Road Campus
2 days ago

Balfour Beatty pioneers plastic pylons in Scotland

140 composite poles installed by new helicopter crane in just five days
3 days ago

Plan for 55-storey Manchester student skyscraper

Plans submitted for 168m tall red brick tower at Hulme Street
3 days ago

Crossrail sparks threaten stoppages over lack of loos

Electricians threaten to down tools at Bond Street station site
3 days ago

37 firms to pitch innovations for Heathrow expansion

Search for Heathrow’s Innovation Partners progresses for 3rd runway
3 days ago

Contractor services