Costain Group (COST) investor relations material

Executive summary

• Operating profit and margin increased, driven by strong Natural Resources performance, while Transportation declined due to contract completions and HS2 rephasing.

• Revenue for H1 2025 was £525.4m, down 17.8% year-over-year, but forward work position rose to £5.6bn, over four times last year’s revenue, with 90% of forecast revenue for the year secured.

• Net cash remains strong at £144.9m, with a year-end target of £170m and a robust balance sheet.

• Enhanced shareholder returns through a 150% increase in interim dividend to 1.0p per share and completion of a £10m share buyback.

• Confident in meeting FY 2025 expectations and delivering a step change in growth by 2027.

Financial highlights

• Adjusted operating profit: £16.8m (up 3.1%); reported operating profit: £16.4m (up 18%).

• Adjusted operating margin: 3.2% (up from 2.5%); on track for 4.5% run rate in FY 2025.

• Adjusted EPS: 5.5p (down 1.7%); reported EPS: 5.4p (up 8%).

• Interim dividend increased to 1.0p per share (up 150%); £10m share buyback completed.

• Net cash at period end: £144.9m; adjusted free cash outflow: £3.0m due to timing of receipts and working capital.

Outlook and guidance

• On track to deliver an adjusted operating margin run-rate of 4.5% during FY 2025.

• Revenue expected to be evenly split between H1 and H2; H2 profit and cash weighted due to contract closeouts.

• Step change in revenue, profit, and margin anticipated in 2027, underpinned by high-quality contracts and strong forward work.

• 90% of forecast revenue for FY 2025 already secured; high bidding activity continues.

• Confident in delivering margin targets in excess of 5% in the medium term.