Miller Group has made a pre-tax loss of £26.9m for the six months to 30 June 2010, an improvement on last year's interim performance when it was £33.8m in the red.
However, the group's turnover fell to £338m, a 16% drop on the £404m posted for the same period a year ago.
Miller, the UK's largest privately-owned house-building, development and construction business, cut its net debt by £135m to £808m, after generating cash inflow before financing of £74.7m (H1 2009: £13m).
Chris Webster, formerly chief operating officer at Amey, has been appointed as the new chief executive of Miller Construction, after Robin Mackie retired in August following 33 years with the firm.
Operations
The construction business generated an improved operating profit of of £3.8m (H1 2009: £2.9m), despite turnover falling “as anticipated” to £155m (H1 2009: £228m).
The firm expects turnover to be around £300m for the whole of 2010.
During the period, Miller was selected for the NHS ProCure 21+ and Leeds Teaching Hospitals NHS Trust frameworks.
It was preferred bidder on the Gloucester Police PPP project, which has been cancelled, but its Leicester Building Schools for the Future scheme has been unaffected by the government cuts.
Overall, the forward order book shrank to £569m (H1 2009: £600m).
In housing, Miller achieved 954 completions during the first half, a 9% reduction from the 1,048 completions in the same period during 2009. The firm said this was due to lower sales to private investors and housing associations.
The average selling price increased by 12% to £170k (2009: £151k) as a result of a mix change and the strategic decision to increase focus on family housing.
Forward sales totalled 1,804 units, which Miller said represented 90% of its 2010 target.
It bought only 303 plots during the first half of 2010, giving a total consented landbank of 7,200 plots.
The improved housing market prompted Miller to open nine new sales outlets during the first half of the year. It operated from an average of 79 sales outlets during the reporting period.
The commercial property business was boosted by the disposal of Edinburgh Quay offices for £21.5m.
Outlook
Sir Brian Stewart, Chairman said: “Miller Group has generated a solid performance which we expect to continue, despite the current economic and financial uncertainties and the likelihood of severe public sector spending cuts later this year, all of which is likely to impact adversely on consumer confidence.
“Whilst there have been encouraging signs of economic recovery, it is widely acknowledged that the markets will remain unpredictable in the short to medium-term exacerbated by the Spending Review in October and proposed government spending cuts.
“In 2008, the Group took the prudent decision to restructure the business to reflect the economic and financial markets; the benefits of this action are now beginning to show. These efficiencies, together with the diversity of our Group, stand us in good stead to navigate the Group back into profitability."
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