Kier revenue rockets on May Gurney acquisition

27th Feb 2014 12:47

Construction, services and property group Kier posted a 47 per cent leap in first half revenue, boosted in part by its acquisition of services firm May Gurney in July last year. Sales rose from £976m to £1.43bn year-on-year, helping pre-tax profit hit £36.8m from £19.4m a year earlier. Underlying earnings per share climbed from 38.6p to 54.6p. The group incurred an exceptional charge of £22m (2012: £4.4m) relating to the transaction costs and the ongoing integration of May Gurney. Outgoing Chief Executive, Paul Sheffield, said: "We are pleased with the performance of the May Gurney which is operating in line with our expectations [...]."The integration remains on course, with good customer retention, new extended contracts and revenue synergies. We are on track to deliver the anticipated £5m cost savings in this financial year. The Construction and Property divisions continue to strengthen.""As reported at the year-end, we are seeing early signs of economic recovery across the country. Our wider portfolio of offerings, strong cost management, a growing order book of over £6bn together with our strong capital structure, position us well for the future. We are encouraged by the prospects for the medium-term. We remain on course to meet the board's expectations for the current financial year."The interim dividend was increased from 21.5p to 22.5p a share. Numis commented that the results were strong, and said profit before tax "was better than our £30m estimate, reflecting stronger performances from Construction and Property divisions". It upped its target price from 1,950p to 2,125p, with an 'add' rating. NR