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Kier back in the black

Kier has posted a pretax profit for the year to 31 June 2021, after the company instituted a turnaround strategy following previous heavy losses.

The business made a pretax profit of £5.6m in 2021, compared to a £225.3m loss in the same period a year before. Turnover in the year to 30 June 2021 was down to £3.3bn from £3.5bn the previous year.

Kier had previously sold its housing arm Kier Living for £110m to simplify the group and raised £240m of fresh capital in a bid to reverse its losses.

The group now has net cash as of the year end of £3m, compared with net debt at the end of the previous year of £310m.

With an order book of £7.7bn, Kier is now targeting revenue of £4bn-£5bn and an adjusted operating profit margin of 3.5%.

Chief executive Andrew Davies said: “The Group delivered a strong operational performance and materially improved results in FY21. We have completed the strategic actions set out in 2019 to simplify and focus the group, improve cash generation and strengthen our balance sheet.

“The successful capital raise, the recent sale of Kier Living, and the extension of the group’s revolving credit facility provides Kier with the financial and operational flexibility to continue to pursue its strategic objectives within its chosen markets and will allow it to further enhance and capitalise on its position as a strategic partner to its customers.

“Current trading is in line with our expectations, and despite inflationary pressures and the impact of increased national insurance contributions, our outlook for the current year remains unchanged.

“We are now focused on delivering our medium-term value creation plan by leveraging our attractive market positions, delivering our high-quality order book and fostering our long-term customer relationships and sector expertise.”

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