Despite seeing a decline in new orders, Carillion has announced it is on track to achieve full-year revenue growth…
Construction group Carillion has reported significant growth in its construction activities during the first half of the year. This has contributed to a 21 per cent leap in group revenue to £2.26bn from £1.9bn the previous year. This was largely due to the high number of contract awards in 2014.
According to the group previous contracts kept total secure orders at around £17bn. This was down from £18.6bn at the end of last year. Additionally, the contractor saw the number of new orders fall to just £1bn in the first half of the year. This was down significantly from £3.4bn seen during the same period the year before. The company said this fall was due to a pause in public sector contract awards.
Carillion reported that although pre-tax profits had remained fairly stagnant at £67.5m, underlying profit had in fact grown by 16 per cent. This was after accounting for the cost of mobilising new contracts and the downward trend within the sector for services.
However, the firm reported its net borrowing had risen in the first half of the year from £177m to £200m six months earlier. This was due in part to business acquisition costs, rather than operating cash flow.
In a statement, Carillion Chairman Philip Green said: “I am pleased to report that Carillion has continued to perform in line with expectations, which reflects the actions we took during the economic downturn to position our businesses in markets where we can now achieve revenue growth, consistent with our targets for margins and cash flow.
“We have also made good progress with mobilising a number of major new contracts won in 2014.
“Therefore, with a strong order book, a growing pipeline of contract opportunities and the prospect of market conditions continuing to improve, our expectations for 2015 and the medium term remain unchanged.”