Galliford comes in ahead of six month forecast

HIGHER than expected half-year profits and an improvement in net debt are among the highlights in a business update by Galliford Try plc.
The group expects to announce its six-month results in February and it anticipates that net debt will have reduced from £69.8m in 2011 to £60m.
In construction, the group reports a stable £1.6 billion order book in line with expectations as it continues a strategy of managing risk. Forty per cent of the order book is from the regulated sector, 42% in public and 18% in private, maintaining what the group described as a “high quality and diverse spread of future revenues”.
By the end of last year, the business had secured 99% of its projected revenue for the current financial year and 62% for the next. “Our robust order book provides a strong platform for 2013 and 2014,” it said.
In response to the challenging conditions, the company maintained its strategy of focusing on margins and cash as well as securing work with acceptable returns and risk.
More than half the order book was secured from frameworks and the group said it is encouraged by the UK Government’s announcement in the autumn budget of the need for infrastructure investment. During the six months major project wins included the £89m Resorts World project for Genting in Birmingham and the £80m Kingskerswell Bypass. “We have a pipeline of opportunities that we expect to announce in the second half of the year,” it added.
In house building, revenue is expected to be up on last year through a combination of a record 1,364 completions – 1,229 net of joint venture partners’ share – and an increase in the average selling price.
Chief executive Greg Fitzgerald said: “We are encouraged by the performance of both house building and construction in the first half of the financial year with profits ahead of board expectations.
“House building continues to deliver good results in a stable market with construction performing well against a backdrop of a difficult market. We continue to manage cash with group net debt improving on last year. Notwithstanding the continuing challenging economic conditions the group remains on track to meet its expectations for the financial year and is well positioned to deliver growth.”