Kier has seen its revenue and profits dip for the year ended 30 June 2013 but its acquisition of May Gurney earlier in the year was a “key milestone” in the growth of the Group.

The Group saw pre-tax profit fall 9% to £63.4m on revenue of £1,983m, which was slightly lower than last year’s figure of £2,069m.

The drop in revenue was primarily down to a reduction in construction revenues. Kier blamed poor weather which caused delays and pushed revenues into the 2014 financial year.

As predicted, Kier said it had seen a change in the mix of activities, with more infrastructure and overseas work.

After the acquisition of May Gurney in July, Kier now has a combined order book of £5.9bn across its construction and services divisions.

Kier said the strategic rationale for the acquisition was “to enable us to deliver more services to more customers over a wider geography.”

In utility services, Kier now has a greater presence in the telecommunications sector and an “increased operational capability in many of the water authority regions on AMP5 schemes, which will position us well for the forthcoming AMP6 tenders in 2014.”

“Since the acquisition, we have not lost any contracts and our combined set of capabilities has enabled us to bid on a range of new projects covering water, rail and highways with a total value in excess of £500m,” Kier said.

Commenting on the results, Kier Group plc chief executive, Paul Sheffield, said:

"I am pleased to report that Kier Group plc has performed well and delivered profits in line with our expectations. The modest decline in revenue and profit reflects the tough trading conditions the industry has faced during the year, but I am delighted to see that the divisional trading results remain robust. Margins in Construction and Services were resilient and our Property division again made a strong contribution.

"The acquisition of May Gurney in July 2013 creates a support services business with revenues in excess of £1bn and provides an excellent platform for growth. The integration and interaction with key clients are both proceeding well and the combination of the two businesses will deliver significant synergies.

"After nearly five years of recessionary pressure, we are seeing positive signs of improvement in all our principal businesses, which gives rise to cautious optimism that the economy is recovering. As a result, we have increased the full year dividend by 3% to 68p, reflecting our confidence in the future performance of the business."

On its outlook, Kier said:

“With our entire forecast Construction revenue and 95% of our Services revenue secure and probable for 2014, we are in a strong position to achieve organic growth, which coupled with the strength of the forward bidding pipeline gives us comfort that this trend is likely to continue.

 “The bidding for AMP6, across the water sector, will commence later this year and we are well placed to capitalise on the combined capabilities of the two businesses.”

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