Morgan Sindall Group Regulatory News (MGNS)

28 Jun 2006 07:01

Morgan Sindall PLC28 June 2006 Morgan Sindall plc Pre-close Trading Update The Board of Morgan Sindall today announces an update of trading for the sixmonths to 30 June 2006. The Group's interim results will be announced on Monday7 August 2006. Trading Overall the Group is trading in line with expectations and seeing year on yeargrowth. Fit Out's market has grown strongly during the first half of the year and thedivision has been successful in securing new contracts with a total value of£231m. Consequently this division is expected to make a higher contribution forthe full year compared to our previous expectations. Construction continues to be successful in winning contracts in its targetsectors of health, education, light industrial and commercial. Revenue isexpected to be in line with the previous year and the order book has beenmaintained. Infrastructure Services has seen modest revenue growth. The division hasundergone a reorganisation to ensure it has the right balance of resources tomatch its future workload and the costs of this will impact the current year. InMarch the division acquired a non-track rail infrastructure business, which hasattractive prospects due to the investment to be made in the London Undergroundnetwork over the medium term. Overall, the division has been successful insecuring £330m of new contracts in the first half of the year including therecent two year extension to its water framework contract with Scottish WaterSolutions. In addition the division has been appointed preferred bidder withits partner for a seven-year, £420m contract to upgrade gas networks across theNorth of England for United Utilities as previously announced. Consequently weexpect a return to historic levels of profitability in 2007. Affordable Housing continues to grow strongly. The continuing Decent Homes andmixed tenure opportunities give us confidence in the market's medium termstrength. As in previous years, profit will be weighted to the second halfreflecting the timing of open market house sales. Overall the Group's order intake in the first half of the year has been strong,reflecting the success in securing longer term contracts in InfrastructureServices and the strength of the Fit Out market. The forward order book is£3.1bn, an increase of 11% since the beginning of the year. Average cashbalances will be lower than in the previous year, reflecting the recentacquisition and further investment in working capital at Affordable Housing. John Morgan, Executive Chairman commented: "The Group has made further progress in the first half of 2006, winning a numberof new contracts giving us another record order book. All of our market sectorsare growing, which offers exciting opportunities and provides a positive outlookfor the Group." 28 June 2006 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