Galliford Try’s integration of Miller Construction ‘ahead of expectations’

Galliford_TryGalliford Try has reported a strong half-year performance, with the integration of Edinburgh-based Miller Construction virtually complete.

The contractor said assimilation of the Scottish construction firm, which it bought for almost £17 million last July, into the wider group has “proceeded very well and is substantially complete ahead of plan”.

In a trading update Galliford said its overall construction business has an order book of £3.2 billion, up from £1.75bn at the same point in 2014, after a number of major project wins in the six months to December 31.

Net debt was more than halved from December 2013 to £40m despite an increase in the land bank.

In housebuilding, Galliford said revenue is expected to be 12.5 per cent up on the prior half-year period at 1,529 unit completions.

The 1,404 net of joint-venture partners’ share will be up 9.7 per cent.

Total sales reserved, contracted and completed stood at the end of December at £645m from a lower number of average selling outlets compared to £652m in 2013.

Outlets are expected to increase from an average of 67 in the first half to 75 in the period from January to June this year.

The land bank is at a record 14,050 plots, with the land market continuing to be positive and 98 per cent of land secured for 2016.

The operating margin at the Linden Homes’ subsidiary is expected to improve on the same period last year, with the average Linden Homes selling price up 7 per cent at £310,000.

Enlarged business benefited from high quality clients and diverse future revenues, with 21 per cent of the order book in the regulated sector, 59 per cent in public and 20 per cent in private.

No less than 98 per cent of projected revenue for the current financial year is secured, with 72 per cent for the year to June 30, 2016.

Greg Fitzgerald, executive chairman, hailed another “strong performance” for the Group for the first half of the financial year in which housebuilding and construction businesses both performed “in line with our expectations”.

He added: “Housing market conditions remain good with growth having moderated to a more normal and sustainable level, and we are optimistic about the prospects for a number of recent and forthcoming sales outlets. Our Partnerships business continues to see exceptional prospects for both contracting and development in the affordable market.

“Following the acquisition of Miller Construction in July 2014 our enlarged Construction business is benefitting from an improving market. We remain confident in the delivery of our strategy of strong and disciplined growth across all of our businesses.”

Shares in Galliford Try, which is also parent group of Queensferry Crossing contractor Morrison Construction, closed the day up 37p at 1,272p.

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