Broker snap: Kier reducing its government dependency

24th Feb 2011 12:33

Kier Group remains "steady and reliable", according to RBS, as the first half results confirm that the group's progress remains on track.Pre-tax profit for the six months ended 31 December was £31.3m, ahead of the broker's forecast of £30m, while the interim dividend of 20p per share was higher than the estimate of 19.1p.RBS says that the key features of the first half are the group winning £100m of work in the commercial market, and £85m overseas, "in accordance with how we view the group being able to partially offset the UK government capex [capital expenditure] reductions.""Kier is more advanced than others, in our view, at diversifying away from the areas of strongest declines in the UK public sector and its Support Services business has real credibility," says the broker.The target price stays at 1,605p.