Kier Group on track to meet expectations for the year

Kier Group said it is on track to meet is expectations for the current financial year, with results weighed towards the second half.

The property, residential, construction and services group said good progress has been made on the integration of the Mouchel acquisition, completed in June, and the company remains on track to deliver £4m of synergies in the second half of next year.

Kier said the property division continues to perform well, with a pipeline of more than £1bn. It said this performance was underpinned by strong occupier and investor interest, resulting in an annualised return on capital ahead of the group’s 15% target for the unit.

The residential division, meanwhile, is benefiting from the demand in the UK for all forms of housing, with around 2,350 completions expected this year, approximately 10% ahead of last year.

In Construction, Kier said performance was in line with management’s expectation, with the division securing more than £700m of new work in the period. The current order book represents 100% of targeted revenue for the 2016 financial year.

The services business order book represents more than 95% of targeted revenues for 2016, with underlying operating margins in line with expectations at around 4.7%.

“Our combined Construction and Services order books of more than £9bn, together with a strong pipeline of opportunities, position the group well for the future.”

At 0952 GMT, Kier shares were up 0.3% at 1,328p.