INTERVIEW: Keller Sees US Revenue Rising But Margins Weak

2nd Aug 2010 09:57

By Jason Douglas Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Construction engineer Keller Group PLC (KLR.LN) Monday said it expects revenue from the U.S. to grow in the second half of 2010 but margins will remain under pressure until next year. "Our revenue will start to nudge up but it will take time for our margins to recover. I think margins will remain under pressure for the rest of this year," Chief Executive Justin Atkinson told Dow Jones Newswires. Keller, which specializes in ground engineering like foundations, warned in May first-half earnings would miss market expectations because of bad weather and weak trading in the U.S. It said Monday revenue at its U.S. operations declined to GBP198 million from GBP268 million a year earlier because construction activity slowed. The U.S. operations reported a small operating loss. Atkinson said margins have been under pressure because Keller and its competitors have been cutting prices to win what limited business is available. This trend is expected to continue, he said. Orders at the end of June were 13% higher on year, however, so second-half revenue is expected to show a year-on-year improvement, Atkinson said. The company said its long-term confidence in the U.S. market is undiminished. Atkinson said markets like Australia and Singapore remain strong. He added the company is excited about prospects in India. -By Jason Douglas, Dow Jones Newswires; 44-20-7842-9272; [email protected] (END) Dow Jones Newswires August 02, 2010 04:57 ET (08:57 GMT)