'Decisive cost actions' turn a decline in revenues to an increase in profits for construction giant
By James Young | 5th March 2020
'Decisive management actions' have been credited in construction giants Kier posting an increase in half-year profits.
The construction and infrastructure company with a Gloucester base announced this morning that despite revenues falling by nine per cent in the six months to December 31, profits increased by 3.4 per cent.
The announcement to the Stock Exchange confirmed that "decisive cost actions" are now benefitting the group.
Revenues fell to £1.866billion from £2.053billion for the same period last year, however due to those aforementioned cost actions, profits rose to £46.7 million from £41.9million in 2018.
Chief executive Andrew Davies said: "I am pleased to report that many of the actions we outlined at the beginning of the year have been executed successfully.
"In particular, the decisive cost actions we have taken are now benefiting the Group and have more than compensated for the challenging market conditions we experienced in the period.
"These actions resulted in an increase of 3.4% in operating profit before exceptionals and the impact of IFRS 16.
"The Group has been awarded places on several major frameworks since January 1 2020, following the awards of c.£1.7bn in the period, and the Government has recently confirmed that the HS2 project will proceed.
"We have a new executive management team in place; we are continuing to embed Performance Excellence; and our cost reduction programme is expected to deliver benefits of at least £65m by 30 June 2021.
"We expect to reduce the capital invested in our non-core businesses and to progress the sale of Living.
"The work to re-shape the Group continues, as we focus on executing our strategic priorities and reducing net debt."
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