Company Announcements

4 May 2023

Morgan Sindall Group plc

Trading Update

Ahead of today's Annual General Meeting ('AGM'), Morgan Sindall Group plc ('the Group'), the construction and regeneration group, provides an update on trading and the outlook for the 2023 financial year.

Group performance & outlook

Trading since the start of the year has been as expected and the general market conditions coming into 2023 have continued to ease, with inflation falling in certain areas.

Based on the current visibility of workload for delivery through the remainder of the year, the Group is confident of delivering a full year performance which is in line with its expectations and with more of a weighting towards the first half than in recent years.

Trading by division

Construction & Infrastructure remains focused on contract selectivity, risk management and operational delivery and both Construction and Infrastructure are anticipated to deliver revenue growth at margins which are in line with their respective medium-term targets.  

Fit Out's trading has been very strong and its order book and enquiry levels provide confidence for the rest of the year.

In Property Services, margin has been impacted by disappointing contract delivery despite the expected higher level of revenue.

Partnership Housing has seen a gradual increase in open-market sales activity in its mixed-tenure activities since the start of the year in line with the rest of the UK housing industry, albeit still well below prior year levels, while the division's contracting activities have remained relatively robust. The average capital employed for the full year is estimated at c£235m.

The developments and schemes in Urban Regeneration have progressed broadly as planned and the average capital employed for the year is expected to be c£90m.

Group secured workload

The total secured workload for the Group at 31 March 2023 was £8.8bn, up 4% from the year-end and up 2% versus the prior year.

This comprised the construction secured order book of £4.9bn, up 7% from the year-end and up 9% versus the prior year, and the regeneration secured order book of £3.9bn, which was up 1% from the year end and down 6% versus the prior year.

Balance sheet and net cash

The average daily net cash from 1 January to 2 May was £281m (of which £45m was held in jointly controlled operations or held for future payment to designated suppliers (JVs/PBAs)). The average daily net cash for the same period last year was £278m.

As expected, the average daily net cash for the full year is currently anticipated to be around £250m.

John Morgan, Chief Executive, said:

"Since the start of the year, trading has been as expected and the general market conditions coming into 2023 have continued to ease with inflation falling in certain areas.

Based on the current visibility of workload for delivery through the remainder of the year, we're confident of delivering a full year performance which is in line with our expectations."

ENDS

Note to Editors

Morgan Sindall Group

Morgan Sindall Group plc is a leading UK Construction & Regeneration group with annual revenue of £3.6bn, employing around 7,200 employees and operating in the public, regulated and private sectors.  It reports through five divisions of Construction & Infrastructure, Fit Out, Property Services, Partnership Housing and Urban Regeneration.