Kier trading in line after Covid-19 hits results

(Sharecast News) - Kier Group said it was trading in line with expectations after Covid-19 hit the construction and infrastructure services company's annual results.
The company reported a £225.3m pretax loss for the year to the end of June compared with £229.5m loss a year earlier as adjusted revenue dropped to £3.5bn from £4.1bn.

Operating profit before adjusting items fell to £41m from £86m. Net debt increased to £310m from £167m a year earlier.

The Covid-19 crisis caught Kier in the middle of a big restructuring programme under new management. Trading was in line with expectations until the end of March but Covid-19 reduced the work Kier could carry out and increased costs.

The company said its annual results reflected the impact of Covid-19 partly offset by reduced overheads as part of its efficiency drive. Restructuring costs were £156m in the year as the company cut 1,700 jobs.

The company's shares rose 11.8% to 61.23p at 10:24 BST after it published an upbeat assessment of its prospects.

Kier said it had a stable order book of £7.9bn at the end of June, underpinned by contract wins, and that it expected annualised cost savings of at least £100m by the end of the current financial year. The company said it was in a good position to gain from the UK government's planned increases in infrastructure spending.

Andrew Davies, chief executive, said: "Whilst the group anticipates that the effects of Covid-19 will continue, the strategic actions being implemented by the new senior management team are designed to ensure Kier is well placed to benefit from the proposed substantial increase in UK infrastructure investment. We have a strong order book and the current year has started in line with our expectations. "