Results for the year to June 30 2012 show construction margins holding up at 2.5% compared to 2.7% last time while services stayed the same at 4.5%.

Pre-tax profits edged-up to £70m from £68.9m as revenue dipped 5% to £2,069m from £2,179m.

Construction accounted for £1,383m of turnover and £35.2m of profit as Kier bosses  focused on quality projects and tried to avoid suicide bidding wars.

Chief executive Paul Sheffield said: “We have maintained a focus, across the Group, on pursuing good quality opportunities where experienced customers seek intelligent solutions rather than the lowest price.

“Although we are unable to avoid the increasingly competitive markets entirely, this approach has partly insulated us and I am pleased that we have been able to maintain our secured pipeline of work at the same level as last year across our Construction and Services divisions.”

The competitive market has seen Kier shift resources to the higher performing areas of London and the south-east, infrastructure and the international division.

Sheffield said: “Our Construction division has seen a significant change in the balance of its work with a greater proportion of more specialist major civil engineering and infrastructure opportunities while still maintaining its strong presence in the more traditional general building markets.”

Kier now has a 50/50 split between private and public work with commercial,power and waste projects offering the fastest growing opportunities.

Sheffield does not expect the market to pick up until the end of 2013 at the earliest.

He said: “We do not however expect the current challenging UK market to improve in the short term and this will inevitably put further pressure on UK construction margins and cash performance over the next 12 to 18 months.”