KIER GROUP PLC Kier Group plc
Results for the six months ended 31 December 2023
7 March 2024
Disclaimer
No representation or warranty, express or implied, is made or given by or on behalf of Kier Group plc (the "Company" and, together with its subsidiaries and subsidiary undertakings, the "Group") or any of its directors or any other person as to the accuracy, completeness or fairness of the information contained in this presentation and no responsibility or liability is accepted for any such information. This presentation does not constitute an offer of securities by the Company and no investment decision or transaction in the securities of the Company should be made on the basis of the information contained in this presentation.
This presentation contains certain information which the Company's management believes is required to understand the performance of the Group. However, not all of the information in this presentation has been audited. Further, this presentation includes or implies statements or information that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may use forward-looking terminology, including the terms "believes", "estimates", "anticipates", "expects", "intends", "may", "will" or "should". By their nature, forward-looking statements involve risks and uncertainties and recipients are cautioned that any such forward-looking statements are not guarantees of future performance. The Company's or the Group's actual results and performance may differ materially from the impression created by the forward-looking statements or any other information in this presentation.
The Company undertakes no obligation to update or revise any information contained in this presentation, except as may be required by applicable law and regulation. Nothing in this presentation is intended to be, or intended to be construed as, a profit forecast or a guide as to the performance, financial or otherwise, of the Company or the Group whether in the current or any future financial year.
This presentation and its contents should not be distributed, published or reproduced (in whole or in part) or disclosed by recipients to any other person.
Certain information in this presentation has been extracted from the announcement of HY24 full year results made by the Company on 7 March 2024 and this presentation is not a substitute for reading that announcement in full.
HY24 Results Presentation, 7 March 2024
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Results Summary
Andrew Davies, CEO
HY24 Highlights
- Revenue growth and improved profitability driving material deleveraging
- Revenue growth of 23% driven by Infrastructure Services and Construction
- Adjusted operating profit increased 13% to £64.7m (HY23: £57.2m)
- Adjusted operating margin at 3.4%, in-line with the medium-term target
- Free Cash Flow of £(7.9)m materially improved vs HY23 £(87.8)m following a strong Q1 performance
- Net cash of £17.0m, higher than prior period-end (HY23: net debt (£130.6m))
- Average month-end net debt materially reduced by £106.2m to £136.5m
- High quality order book, increased 6% to £10.7bn (FY23: £10.1bn) providing significant visibility
- Acquisition of Buckingham Group's rail assets fully integrated
- Successful refinancing post period-end
- Resumption of dividends, interim dividend of 1.67p per share declared
- Sustainability strategy on track
HY24 Results Presentation, 7 March 2024
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HY24 Results
Simon Kesterton, CFO
Financial Highlights
Strong increase in revenue growth of 22.5%
£'m | HY24 | % | HY23 | % | Δ | FY23 | % |
Revenue | 1,883 | 1,537 | 22.5% | 3,405 | |||
Adjusted Operating Profit | 64.7 | 3.4 | 57.2 | 3.7 | 13.1% | 131.5 | 3.9 |
Net finance costs | (15.7) | (11.4) | (37.7%) | (26.7) | |||
Adjusted Profit before tax | 49.0 | 2.6 | 45.8 | 3.0 | 7.0% | 104.8 | 3.1 |
Adjusting items | (10.9) | (10.6) | (2.8%) | (33.7) | |||
Amortisation | (11.1) | (9.8) | (13.3%) | (19.2) | |||
Profit before tax | 27.0 | 25.4 | 6.3% | 51.9 | |||
Taxation | (7.4) | (5.0) | (48.0%) | (10.9) | |||
Profit after tax | 19.6 | 20.4 | (3.9%) | 41.0 | |||
Adjusted basic EPS | 8.7p | 8.5p | 2.4% | 19.2p | |||
Statutory EPS | 4.6p | 4.7p | (2.1%) | 9.5p | |||
Free cash flow | (7.9) | (87.8) | 91.0% | 132.3 | |||
Net cash / (debt) | 17.0 | (130.6) | 113.0% | 64.1 | |||
Average month-end net debt | (136.5) | (242.7) | 43.8% | (232.1) |
- Significant volume growth across the group
- Strong adjusted operating profit of £64.7m (3.4% margin)
- Increased interest rates partially offsetting reduced debt
- Increased profit before tax to £27m
- Taxation increase reflects UK Corporation Tax rate change
- Net cash of £17m achieved
- Reduction of average month-end net debt of £106m driven by cash conversion of profits and working capital benefit of revenue growth
HY24 Results Presentation, 7 March 2024
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Revenue Performance
Significant growth in Infrastructure Services and Construction
22.5%
- Revenue increase of 22.5% in HY24:
- Infrastructure - benefiting from HS2 volumes and Buckingham rail acquisition
- Construction - strong order book converting to revenue
- Continued bidding discipline and risk management
HY24 Results Presentation, 7 March 2024
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Adjusted Operating Profit
Operating profit increase driven by volume growth and management actions
Adjusted operating profit of £65m, 3.4% margin
Increase against prior year:
Volume / price / mix
Management actions
Decrease against prior year:
Cost Inflation
HY24 Results Presentation, 7 March 2024
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Adjusting Items
Restructuring activities complete
£'m | HY24 | HY23 | FY23 | |
Amortisation | 11.1 | 9.8 | 19.2 | |
Fire and cladding compliance costs | 7.2 | 4.0 | 12.6 | |
Legacy legal claims | 1.1 | 1.5 | 1.5 | |
Insurance-related items | - | - | 5.3 | |
Redundancy and other people related costs | - | 1.7 | 4.8 | |
Professional adviser fees & implementing | - | 0.3 | 4.9 | |
non-people initiatives | ||||
Other | 1.2 | 1.6 | 1.7 | |
Total adjusting items to operating profit | 20.6 | 18.9 | 50.0 | |
Finance costs | 1.4 | 1.5 | 2.9 | |
Total adjusting items to profit before tax | 22.0 | 20.4 | 52.9 | |
Cash cost | 16.1 | 22.7 | 27 | |
- Amortisation - £11m of non-cash accounting charges increased due to Buckingham rail acquisition
- Fire compliance costs of £7m relate to updated fire compliance regulations on legacy projects
- Cash cost includes c.£9m relating to items accrued in previous periods
HY24 Results Presentation, 7 March 2024
9
Free Cash Flow
Positive cash conversion despite the usual seasonable working capital outflow
£'m | HY24 | HY23 | FY23 | Positive adjusted operating cash flow |
Adjusted EBITDA | 92.2 | 90.9 | 196.0 | |
conversion of 19% despite usual seasonal | ||||
Working capital | (46.4) | (78.7) | 80.3 | |
working capital outflow | ||||
Net capex (Including IFRS16 leases) | (26.3) | (27.1) | (51.4) | |
JV dividends less profits | (5.9) | (2.2) | 0.7 | Positive operating free cashflow of £12m |
KEPS repayment | - | (49.8) | (49.8) | achieved |
Other | (1.2) | (2.9) | (5.2) | Supplier payment days improved by one day to |
Operating Free Cash Flow | 12.4 | (69.8) | 170.6 | |
33 days | ||||
Adjusted conversion | 19% | (122%) | 130% | |
Net interest & tax | (20.3) | (18.0) | (38.3) | |
Free Cash Flow | (7.9) | (87.8) | 132.3 | |
HY24 Results Presentation, 7 March 2024
Note: (1) Other consists of share-based payments, fair value adjustments, pension adjustments and profit on disposal of PPE
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Kier Group plc published this content on 07 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 07 March 2024 09:09:08 UTC.
