With Galliford Try substantially shrunk by the sale of its house-building interests to Bovis and with Interserve also shrinking, Morgan Sindall now firmly asserts itself as number three behind Balfour Beatty and Kier.
For the full year 2019 Morgan Sindall Group gew revenue by 3% to £3,071m (2018: £2,972m). Profit before tax was up 10% to £88.6m (2018: £80.6m).
Average daily net cash increased to £109m (2018: £99m) and the year-end net cash position was £193m. Secured workload in the order book was up 14% during the year to £7.6bn.
Construction & Infrastructure revenue increased by 11% to £1,486m and – with an increase of 20bps in the operating margin, up to 2.2% – operating profit was 20% higher at £32.3m.
Fit Out revenue was up 1% to £839m but ‘a more competitive tendering environment’ pushed operating profit down 16% to £36.9m was 16%. The operating margin remained at 4.4%.
Property Services revenue increased by 15% to £115m and operating profit more than doubled to reach £4.3m.
Partnership Housing contributed an operating profit of £18.3m, up 50% on 2018’s result, while Urban Regeneration was steady with a £19.4m contribution.
Chief executive John Morgan said: "These strong results reflect the high quality of our operations and are testament to the work and commitment of all our people. Our strategic focus on construction and regeneration underpins the positive momentum across the Group and provides the platform for future progress.
“Our balance sheet remains a significant differentiator allowing us to make the right long-term decisions for the business. With our average daily net cash position further increasing in the year, we have the flexibility to continue being highly selective with our bidding while also investing in our regeneration activities.
“Both the volume and the quality of our secured workload have increased in the year leaving us well-positioned for the future. We are confident of another good year of progress in 2020 and the group is in a strong position to deliver on its expectations."
Morgan Sindall is also getting better at paying its suppliers, it seems. Construction & Infrastructure, the largest division, improved its average time taken to pay invoices to 32 days, with 97% of invoices paid within 60 days. “The group's relationships with its supply chain partners are of strategic importance and key to the group's future success, and payment practices will continue to be an area of focus in years ahead,” the company said.
Morgan Sindall Group headline results by business segment
|Revenue £m||Change||Op. Profit/(Loss) £m||Change||Op. Margin %||Change|
|Construction & Infrastructure||1,486||+11%||32.3||+20%||2.2%||+20bps|