Construction and housebuilding group Galliford Try plc has reported record half year results this morning for the six months ended 31 December 2013.

Group revenues are up 18% at £803.5m (H1 2013:£678.3m) and profit before tax is also up 18% at £38.1m (H1 2013:£32.3m). Group revenue (including share of joint ventures) was up 15% to £836.0 million (H1 2013: £725.3 million). Profit before tax was up £5.8 million at £38.1 million (H1 2013: £32.3 million) and earnings per share for the period was up to 36.8p (H1 2013: 31.3p). 

The firm said it was continuing to manage supply chain constraints across all of its businesses.

In the Group’s construction division, which had revenues of £398.1 million, margins have fallen to 1.4% (H1 2013: 1.8%) in line with expectations.The statement said:

“The construction market continues to be challenging although we are seeing an increase in the pipeline of opportunities.”

Galliford Try said it was was continuing to focus on risk management, margin and targeting work with acceptable returns and risk against a background of a difficult market. The division has a robust order book at £1.25 billion (H1 2013: £1.2 billion) - 100% of projected revenue is secured for the current financial year with 65% secured for 2015 (31 December 2012: 100% and 65% respectively).

Total order book is up 4% at £1.25 billion (H1 2013: £1.2 billion) and comprises 19% in the regulated sector, 50% in public and 31% in the private sector. At the start of 2014 the firm had secured 100% of projected revenue for the current financial year and 65% for the next financial year (H1 2013: 100% and 65% respectively).

In its infrastructure division, which carries out civil engineering projects, primarily in the water, highways, flood alleviation, remediation and renewable energy markets in the UK, profit from operations was £3.4 million on revenue of £186.5 million, representing a margin of 1.8% (H1 2013: £3.6 million on £215.4 million, representing a margin of 1.7%).

During the period infrastructure, in joint venture, has been appointed by Yorkshire Water to continue as a contractor for its AMP6 framework. The framework will commence in 2015 and is anticipated to generate at least £110 million over a five year appointment. Infrastructure's order book currently stands at £515 million (H1 2013: £626 million).

Galliford Try said that it intends to grow its building and infrastructure businesses by around 50% following a year of “sustained and improved levels of opportunity. “ Turnover in the construction division is expected to increase from an improving private sector as well as an increased participation in frameworks and major projects. In the short term the Group continues to expect operating margin to fall, but then to rise towards 2.0%.

The statement said the firm is pursuing a disciplined growth strategy to 2018 which is expected to more than double FY13's profit before tax and earnings per share. 

Greg Fitzgerald, Chief Executive, commented:

 "The half year saw strong performance across the Group and we have been very encouraged by the start of the calendar year.  Group profit for the half year is at a record high and we continue to be encouraged by the levels of future opportunities.”

“In construction we have increased our order book as our businesses continue to perform strongly in the current market.  Whilst the market in the short term remains challenging we continue to see increased levels of opportunities and I am delighted with the new projects awarded during the period.”

 “The Group's performance since the start of the calendar year has been strong and we are confident of meeting the Board's expectations for the full year.  Reflecting our first half year performance and confidence in the future we have increased the interim dividend by 25% to 15.0 pence per share.”

“ I am also delighted to announce our exciting strategy to 2018 supported by the Group's new £400 million unsecured bank facility, which we anticipate will deliver further strong shareholder returns".