Morgan Sindall Group Regulatory News (MGNS)

27 Jun 2005 07:00

Morgan Sindall PLC27 June 2005 Morgan Sindall plc Pre-close Trading Update The Board of Morgan Sindall today announces an update of trading for the sixmonths to 30 June 2005. The Group's interim results will be announced on Monday8 August 2005. Trading The Group is trading in line with expectations and seeing growth especially inthe fit out and affordable housing sectors. Fit Out has traded strongly during the first half of the year with thecommercial property market showing signs of further improvement. As anticipatedmargins have improved as Fit Out continues to increase its market share and thenew regional offices in Birmingham and Manchester are trading positively. Theoutlook remains encouraging with the forward order book increasing further fromthe start of the year. Construction has continued to improve its business with success in securing thefinancial close of its third NHS LIFT framework in South East Hampshire as wellas further work under framework arrangements. The three offices and associatedcontracts acquired at the end of 2004 have been integrated successfully. Theseoperations have contributed to the division's turnover and profit growth andwill enhance earnings in the current year. The market remains buoyant withGovernment investment in the health and education sectors set to continue. Infrastructure Services is seeing the mix of its business change with utilitieswork growing strongly following the award of major framework contracts with NGTin the Midlands (£350m) and United Utilities in the North West (£450m). Aspreviously announced, civil engineering activity is at a lower level than lastyear as some large projects draw to an end and as a result, we expect turnoverand profit in 2005 to be lower than that achieved last year. The division isbidding for a number of opportunities and is well positioned for the future. Affordable Housing has seen continued strong growth. The division's profit forthis year will be weighted to the second half due to the scheduled timing ofopen market house sales. The outlook for the division remains very positivewith the Decent Homes and Sustainable Communities programmes anticipated tocontinue to 2010 and beyond. Overall the Group's order intake in the first half of the year has been strongreflecting the success in securing longer term framework contracts. The forwardorder book now stands at £2.9bn, an increase of 29% since the beginning of theyear. Average cash balances have been maintained with investment in work inprogress at Lovell balanced by cash generation from other parts of the Group. John Morgan, Executive Chairman commented: "The Group has traded strongly in the first half of the year and I am pleased bythe progress made by each of our divisions. I remain excited about ourprospects not only for the second half but also in the longer term. I lookforward to reporting in more detail in August." 27 June 2005 Enquiries:Morgan Sindall plc Tel: 020 7307 9200Paul Smith, Chief ExecutiveDavid Mulligan, Finance DirectorCollege Hill Tel: 020 7457 2020Matthew Smallwood This information is provided by RNS The company news service from the London Stock Exchange