Record profits for Galliford Try

Galliford Try saw its group revenue fall 2% to £1,467m for the year to 30 June 2013 (2012: £1,504m). Pre-tax profit was up 17% to £74.1m (2012: £63.1m).

The house-building operation saw its operating margin improve from 11.8% to 13.1%, keeping it on course for its target of 17-18% by 2018. After a good summer, the housebuilding business had record sales in hand of £405m as at 1 September 2013.  The business also has a record landbank with all the land it needs for 2014 and 90% of its 2015 requirements.

In construction, market conditions remained “challenging as we expected,” the board said. Operating profits here fell a fifth and are expected to fall further bu revenues have remained stable. The order book also remains steady at £1.7bn.

While government spending cuts are impacting on public sector markets, the private sector is “showing initial signs of slowly improving”, Galliford Try said, with leisure and hotel companies leading the way.

Both the house-building and construction businesses are facing “a background of some labour and supply challenges” but are “maximising production to respond to strengthening customer demand and improved conditions”.

Net debt for the group at year-end was a modest £14.4m.

Chief executive Greg Fitzgerald said: "We have made excellent progress as a group in the financial year and delivered a record profit before tax. We have also significantly increased the full year dividend reflecting the board's confidence in the future.

“Housebuilding has delivered another very strong year of trading. This has been achieved in a disciplined manner following a doubling in size of the business in the preceding three years. Our deliberate investment in high return land opportunities, particularly in the south and southeast, together with a greater focus on margin performance and efficiency gains and an improving market means we are well placed to deliver further good growth.

“Construction has achieved another impressive performance against the background of a market that remains challenging, by focusing on its principles of disciplined contract selection, protecting margin and prioritising cash management.  There are encouraging signs of an improving market on which we are well positioned to capitalise."

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