Galliford Try holds firm in stormy market

Aaron Morby 11 years ago

Improved returns from house building helped Galliford Try ride out the construction squeeze in the first six months of the year as group profits remained flat at £32m.

Construction margins slipped from 2.2% last time to 1.9% as intense competition for work impacted on the firm despite selective bidding to maintain acceptable returns.

Turnover at the construction arm fell 12% to £439m, dragging operating profit down a quarter to £8.3m.

Greg Fitzgerald, chief executive, said: “Our construction business continues to deliver a robust performance against the backdrop of a difficult market.

“We have maintained our core skills and our focus on margin protection, thus delivering profits while managing our planned reduction in turnover.”

Galliford Try’s orderbook remains stable at £1.6bn with all of construction’s projected revenue for the current financial year in the bag at half-year end and 65% of the next financial year secured.

Fitzgerald said: “We are seeing continued momentum in housebuilding particularly in the geographic regions where we operate.

“Underlying growth is strong given that last year’s results included a contribution of £6.9m from one significant land sale.

“In line with our stated strategy and progress to date we will continue our disciplined focus on margin enhancement in housebuilding.”

Housing revenue remained stable at £277m with profits down slightly on last year at £33.5m.

The housing arm still managed a record number of completions up by a dozen units at 1,364, on a margin of 12%.

Galliford Try said it remained confident about prospects ahead and raised its interim dividend by a third.

Project starts in 2013

  • £17m China Centre for St Hugh’s College, University of Oxford
  • A new five star Gainsborough Hotel in Bath for £16m
  • Building a new media and conferencing centre at Gloucestershire County Cricket Club in Bristol
  • £80m A380 South Devon link road for Devon County Council
  • Preferred bidder for £100m Brunswick regeneration scheme
  • £23m contract for Gallions Quarter development in east London
  • £52m redevelopment of the old St Clements Hospital site in east London

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