Kier has lost £470m in the past couple of years but is now back in profit.
Interim results for the six months ended 31st December 2020 show a pre-tax profit of £9.0m, compared to a £41.2m loss for the same period a year before.
Revenue for the half-year was down 13% to £1,624m.
Operating profit was £29m, compared to an operating loss of £24m last time.
Group net debt at 31st December 2020 was £353.5m.
Kier is set to receive £110m for the impending sale of its house-building division to private equity outfit Terra Firma but the board is also proposing to raise an additional £190m to £240m in the coming weeks by selling equity.
With the balance sheet recapitalised, the board reckons, the turnaround that began two years ago will be complete.
Chief executive Andrew Davies said: “I am pleased to report that the execution of the strategic imperatives outlined in June 2019 has resulted in significant improvements in both our financial results and free cash flow for the re-shaped group. With the announcement of the sale of Kier Living on 16 April, we have achieved many of the milestones required to improve cash generation and reduce net debt. The process of simplifying the Group has been substantially completed through the exit of non-core businesses and the adoption of an appropriate cost base. These actions will have delivered annualised cost savings of at least £115m by the end of FY21. We recognize there is much more opportunity within the business and will continue to drive continuous improvement through our Performance Excellence culture.
“With the group focused on UK government and regulated industries, it is well-placed to benefit from the announced and committed increased spend in these areas. We have secured places on the frameworks through which much of the increased spend is expected to come and our nationwide coverage combined with project management expertise gives us confidence in the outlook for Kier over the next few years.
“The proposed equity raise, which we plan to launch in the coming weeks, subject to market conditions, together with the continued support of our lending group, will further strengthen the group’s balance sheet by reducing net debt and will facilitate investment in the business to help drive sustainable, profitable organic growth and the achievement of our medium term financial targets. The second half of the year has started well seeing a continuation of the positive trends of the first half and we are confident of achieving further progress this year in line with our expectations.”