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Figures compiled by construction information specialist Glenigan suggest the group remains amongst the most successful UK contractors at winning new work both by value and number of new contracts.
Kier has jumped from fifth place a year ago to second in Glenigan's league table - which measures the success of the top 50 contractors in winning projects worth over £500,000 - with 198 new UK contracts worth some £1,962 million in the year to August 2011. During the previous year, Kier won 196 new projects worth some £1,308.8 million.
Only Laing O'Rourke won more work by value on Glenigan figures, with contracts worth £2,171 million during the year to August 2011. Amongst other rivals towards the top of the table, Balfour Beatty was in third place with work worth £1,949 million, Morgan Sindall in fourth with work worth £1,899 million and Royal BAM in fifth with work worth £1,553 million.
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In August alone, Kier ranked fourth in Glenigan's league table for winning work with 14 new contracts worth £72.5 million. The league in August was headed by Bowmer & Kirkland (work worth £159.8 million), Balfour Beatty (£101.5 million) and Royal BAM (£91 million).
City analysts are forecasting Kier will report underlying pre-tax profits of £66.4 million for the year to end-June 2011 (2010: £58.4 million). Group turnover is forecast to have risen by 2 per cent to £2,141 million.
Kier's performance is in contrast to the overall market. The Glenigan Index, which tracks all large construction projects across the UK, was down by 8% in July compared to the month a year ago, as public and private sector new starts have slowed.
In June, Kier said it continued to operate in a challenging environment but its financial performance in the year to date remained in line with expectations.
Kier said that trading at its construction division remained strong, helped by high quality order books with good margins and healthy cash balances. Its involvement in public and private sector frameworks left it well-placed to win more work and keep operating margins firmly above 2 per cent.
Moreover, the company has secured 86 per cent of its targeted revenue for the year to June 2012. New infrastructure work was expected to generate significant work for Kier in the short to medium term and the firm's key targets are in the water and power sector.
The City will be keen for news on Kier's partnership homes business which is focused on the mixed-tenure affordable housing market where demand remains high. A league table compiled by Glenigan which monitors housebuilders' activity showed Kier applied to build on three new sites in the year to June 2011, providing a total of 484 units.
Kier is paring back its land bank by developing private homes or selling plots. It hoped to have completed the first phase of plot disposals by the end of June which will return £30 million of cash over the next two years.
(CD/GK)
