Morgan Sindall Group (MGNS) H2 2024 earnings summary

Executive summary

• Achieved a strong year in 2024 with two profit upgrades, double-digit growth in revenue, profit before tax, and dividend, and record performance with group revenue up 10% to £4.5bn and adjusted profit before tax up 19% to £172.5m.

• Secured order book reached £11.4bn, a 28% increase year-over-year, reflecting strong demand and pipeline.

• Maintained a decentralized structure and strong balance sheet, with average daily net cash of £374m and year-end net cash of £492m.

• Increased total dividend per share by 15% to 131.5p.

• Strategic focus on Fit Out as a mature, cash-generative business, and Partnership Housing and Mixed Use as long-term growth drivers.

Financial highlights

• Revenue grew 10% year-over-year to £4,546m; operating profit up 15% to £162.6m; operating margin at 3.6%, up 20bps.

• Profit before tax rose 19% to £172.5m (margin 3.8%, up 30bps); adjusted EPS up 13% to 278.8p.

• Operating cash inflow just under £135m, converting 83% of operating profit to cash; year-end cash at £492m; average daily net cash £374m, up £92m year-over-year.

• Net interest income grew to £9.9m from £3.3m; profit after tax increased 14% to £130.5m.

• Tax charge increased 41% to £42.0m, reflecting higher profits and statutory rate changes.

Outlook and guidance

• 2025 expected to deliver outcomes in line with current expectations; average daily net cash to remain above £300m, with FY 2025 expected to exceed £330m.

• Medium-term targets increased for four of six divisions; Fit Out profit guidance revised to £60–85m.

• Expect solid profit growth in Partnership Housing, modest profits in Mixed Use Partnerships, and top-end profit in Fit Out.

• Construction margin expected at lower end of revised range; Infrastructure margin in the middle; Property Services to return to modest profit.

• National Insurance increase and inflation are headwinds, but mitigation and absorption strategies are in place.