In This Article:
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Adjusted Operating Profit: Increased by 7.5% to GBP43.1 million.
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Operating Margin: Improved to 3.4%, with a second-half margin of 4.4%.
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Adjusted EPS: Up 19.7% to 14.6p.
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Net Cash Position: GBP158 million at year-end.
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Revenue: GBP1.25 billion, slightly down from the previous year.
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Forward Work: Increased by GBP1.5 billion to GBP5.4 billion.
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Dividend: Doubled to 2.4p per share.
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Natural Resources Revenue Growth: Increased by 4.2%.
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Defense and Nuclear Energy Revenue Growth: Increased by 9.8%.
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Water Revenue Growth: Increased by 2.5%.
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Energy Revenue Growth: Increased by 1.3%.
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Central Costs: Increased by 0.9% due to cost and wage inflation.
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Administrative Costs: Decreased by GBP5.8 million to GBP72.2 million.
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Share Buyback: GBP10 million completed in 2024.
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Average Month-End Cash Balance: GBP169.8 million.
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Bonding Facilities Utilization: GBP65.3 million.
Release Date: March 11, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Adjusted operating profits increased by 7.5% to GBP43.1 million, demonstrating strong financial performance.
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The company reported a record increase in forward work, up by GBP1.5 billion to GBP5.4 billion, providing long-term revenue visibility.
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Costain Group PLC (CSGQF) doubled its dividend to shareholders, reflecting confidence in its financial health.
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The company has a strong net cash position of GBP158 million, supporting its strategic initiatives and investments.
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Significant growth in consultancy services, now representing 12% of revenue, indicating diversification and expansion of service offerings.
Negative Points
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Revenue slightly decreased to GBP1.25 billion due to the completion of certain contracts, indicating potential challenges in maintaining growth.
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The company faces challenges in recruiting and developing skills, with a focus on hiring 180 graduates and apprentices.
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Natural Resources margins may decrease as the mix of work changes with the growth in AMP8, potentially impacting profitability.
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The transformation program incurred costs of GBP5.4 million, indicating ongoing expenses related to business restructuring.
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The company settled claims related to fire safety issues, reflecting potential risks and liabilities in project execution.
Q & A Highlights
Q: Can you provide more details on the expected step change in performance by 2027? Is it driven by volume, margin, or both? What are the key challenges in achieving this? A: The step change is primarily driven by the volume of work secured in Water, particularly as AMP8 reaches its peak around 2027. We are also seeing opportunities in transport infrastructure. Margins are expected to remain stable. Key challenges include ensuring we have the necessary skills and capabilities, which we are addressing by recruiting graduates and apprentices and investing in team development. - Alex Vaughan, CEO