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Morgan Sindall (LSE:MGNS), a London-based construction and regeneration company, has reported continued growth in revenue and profit for the first half of the year. The FTSE 250 company, known for its work on the Whitechapel station for Crossrail in 2021, achieved a 14% increase in revenue, rising from £1.9 billion to £2.2 billion for the six months ending June 30. Profit before tax also saw a significant rise, increasing by 17% to £70.1 million. Operating profit improved by 11% to £65 million during the same period.
Earnings Per Share and Dividend
Adjusted earnings per share rose from 98.9p in the first half of 2023 to 112.5p, reflecting a 14% increase. In response to the positive results, the company has increased its interim dividend to 41.5p per share. This dividend adjustment underscores the company’s favorable financial performance and commitment to returning value to shareholders.
Order Book and Market Position
Morgan Sindall’s order book stood at £8.7 billion, a slight decrease from the £8.9 billion recorded in 2023. Despite this minor reduction, the company has maintained a strong market position. John Morgan, the firm’s chief executive and co-founder, attributed the company’s performance to fundamental factors, including a solid balance sheet and cash reserves. He noted that the fit-out sector, where Morgan Sindall holds a leading position, has been a key driver of their success.
Market Conditions and Future Outlook
John Morgan commented on the current market conditions, suggesting that while the fit-out sector may experience a slight slowdown due to its recent strong performance, other markets are either stable or experiencing modest growth. Morgan Sindall is also positioned to benefit from the new Labour government’s plans for affordable housing and social infrastructure, which are expected to increase activity in the construction sector.
However, Morgan also acknowledged that changes in government spending might not immediately impact the company. He noted that while the company is well-prepared for potential future opportunities, the benefits of new policies may take some time to materialize.
Continued Strong Performance
Morgan Sindall’s impressive results continue a trend of strong performance that was evident in the company’s full-year results reported in February. The company has maintained a positive trajectory, outperforming the broader industry, which has faced challenges in recent years. The firm’s balance sheet has also improved, with net cash increasing from £263 million to £351 million, reflecting stronger financial health and operational efficiency.
