Morgan Sindall Group (MGNS) H1 2024 earnings summary

Executive summary

• Achieved record first-half performance with revenue up 14% to £2.2bn and profit before tax up 17% to £70.1m, supported by a robust balance sheet and high-quality order book.

• Interim dividend increased 15% to 41.5p per share, reflecting strong performance and balance sheet confidence.

• Average daily net cash rose to £372m, with period-end net cash at £351m, both up significantly year-over-year.

• The group rebranded to focus on Partnership, Fit Out, and Construction Services, each with distinct dynamics and strategic priorities.

• Full-year performance for 2024 is expected to be slightly ahead of previous expectations.

Financial highlights

• Adjusted operating profit rose 11% to £65.5m, with a group operating margin of 3.0%.

• Adjusted earnings per share increased 14% to 112.5p; interim dividend up 15% to 41.5p per share.

• Group secured order book at £8.7bn, providing strong visibility for the remainder of the year.

• Net working capital outflow of £104.9m, mainly due to investment in Partnerships activities.

• Operating cash outflow of £36.1m, reflecting continued investment in long-term growth.

Outlook and guidance

• Full-year results expected to be slightly ahead of previous guidance, supported by strong first-half trading and a robust order book.

• Construction and Infrastructure expected to meet or exceed revenue and margin targets; Fit Out to exceed medium-term profit targets due to exceptional revenue.

• Property Services expected to halve its H2 loss compared to H1, with return to profitability in 2025.

• Partnership Housing and Mixed Use Partnerships anticipate improved H2 performance, though Mixed Use Partnerships' profit and ROCE will be lower than 2023.

• Average daily net cash for year-end forecasted above £350m, exceeding prior guidance.