• Revenue Growth: Over GBP560 million increase, reaching GBP4 billion, a 17% growth from the previous year.

• Order Book: Increased by 7% to GBP10.8 billion, providing multiyear revenue visibility.

• Adjusted Operating Profit: GBP150 million, with an adjusted operating margin of 3.8%.

• Net Cash Position: Improved to GBP167 million from GBP64 million in FY23.

• Adjusted Earnings Per Share: 20.6p, a 7% increase from 19.2p in 2023.

• Dividend: Proposed final dividend of 3.48p per share, totaling 5.15p per share for FY24.

• Infrastructure Services Revenue: Increased by 16%, driven by HS2 volume growth and acquisition of Buckingham Group's rail assets.

• Construction Revenue: Increased by 15% to GBP1.9 billion.

• Free Cash Flow: Operating cash flow improved to GBP217 million from GBP171 million last year.

• Operating Cash Conversion: Improved from 130% to 145%.

• Warning! GuruFocus has detected 3 Warning Signs with KIERF.

Release Date: September 12, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Kier Group PLC (KIERF) reported significant revenue growth of over GBP560 million for FY24, with improved profitability and strong cash generation.

• The company's order book increased by 7% year over year to GBP10.8 billion, providing multiyear revenue visibility and securing over 90% of FY25 revenue.

• Kier Group PLC (KIERF) successfully delivered the acquisition of Buckingham Group's rail assets and refinanced the group, enhancing financial resilience.

• A final dividend of 3.48p per share was proposed, reflecting confidence in the business and a total dividend of 5.15p per share for FY24.

• The company achieved an adjusted operating margin of 3.8%, surpassing its medium-term value creation plan target, and reported a 31% increase in statutory profit before tax.

Negative Points

• Despite the positive financial performance, the company faced continued, albeit lower, inflationary pressures impacting profitability.

• The construction segment experienced a year-on-year reduction in margin due to a change in mix and increased overheads to support additional site starts.

• The property business faced a challenging environment with scheme evaluations, developments, and transactions being delayed due to market conditions.

• The group's accident incident rate increased by 76% over FY23, indicating a decline in safety performance compared to the previous year.

• The company anticipates a potential GBP20 million net exposure related to fire and cladding costs, following regulatory changes.

Q & A Highlights

Q: With 97% of FY25 revenue secured in construction, do you expect less work won in the year, and are there procurement delays due to government changes? A: We don't anticipate any change in bidding strength or pipeline opportunities across all regions and sectors. The government is evaluating its position, but we expect no long-term policy changes affecting spending. (Andrew Davies, CEO)