Contractor Kier has announced its chairman Phil White is stepping down as the firm reported a rise in half-year profit in its latest results.
The company said White will leave after its AGM in November and will be replaced by Philip Cox, the current chairman of electricity generator Drax.
In its results for the six months to 31 December 2017, Kier reported that it made underlying pretax profit of £46.3m, compared to £41.5m in 2015.
Underlying revenue in the period slipped 1% to £2bn.
From construction activities, underlying operating profit at the company rose 19% to £20.8m with a 2% operating margin. Construction revenue was up 8% for the period to just over £1bn, a new high for the company. The order book for its construction business stands at £3.3bn.
It was also a period of reorganisation for the company. The accounts show a £39m profit on the £75m sale of Mouchel Consulting to WSP in October 2016, but a £33m provision related to the costs of winding down its business in the Caribbean.
Chief executive Haydn Mursell said: “Today’s results reflect the ongoing financial and operational discipline employed across the group and the strength of our flexible, integrated business model.
“The group has a balanced portfolio of businesses and market-leading positions in regional building, infrastructure and housing. Our continued focus on simplifying the portfolio and working with clients in a collaborative way is delivering further growth opportunities. Our clients recognise this approach as a key differentiator when working with Kier.
“The group’s breadth provides some resilience against economic uncertainty and we continue to shape Kier to focus on our core competencies. We are encouraged by the pipeline in the property and residential businesses and our healthy order books of approximately £9bn in the construction and services businesses.
“We remain on course to deliver our expectations for the full year and we are well positioned to achieve our Vision 2020 goals.”
Elsewhere the group also announced a new joint venture with Cross Keys, a housing association and care services provider based in Peterborough.
Kier is transferring part of its land bank and some housing developments in the east of England, valued at up to £97m, into the joint venture. Cross Keys is contributing up to £4m of equity. Transactions are expected to complete by the end of June.
Kier will receive a cash payment of up to £64m for the assets and the JV will be funded by a non-recourse revolving credit facility from HSBC Bank.
The deal will release funds to Kier for reinvestment in other parts of its business in line with its 15% return on capital employed hurdle. Kier expects the transaction to be earnings accretive in 2019.
