Resilient Carillion

3rd Mar 2010 07:31

Support services company Carillion confidently expects to enhance earnings again in 2010 after beating market expectations in 2009 despite challenging market conditions.Total revenue in 2009 grew 4% to £5,426.5m from £5,205.8m in 2008 while underlying profit before tax came in ahead of market expectations at £182.2m, up 16% from 2008’s £157.5m. Market consensus was for adjusted pre-tax profits of £176.43m.On an ‘as reported’ basis, profit before tax jumped 27% to £147.7m from £115.9m.The group’s operating margin improved to 4% from 3.7% the year before, while the support services division’s operating margin improved to 4.9% from 4.6% as the company continued the integration process for the Alfred McAlpine acquisition. The company is now making around £50m of cost savings a year from the McAlpine integration.The order book has slimmed down to £17.7bn from £20.4bn at the end of 2008, which the group attributed to public/private partnership equity sales and non-core business disposals. The group has an ‘excellent pipeline of probable orders and contract opportunities’ but expects market conditions to remain challenging in 2010. In particular, the contribution to revenue from the UK construction services division is expected to continue to decline.A final dividend of 10p has been proposed, making the full year dividend 12% higher at 14.6p than the 13p paid in 2008.