TIDMMGNS
RNS Number : 1200X
Morgan Sindall Group PLC
08 August 2018
8 August 2018
MORGAN SINDALL GROUP PLC
('Morgan Sindall' or the 'Group')
The Construction & Regeneration Group
RESULTS FOR THE HALF YEAR (HY)ED 30 JUNE 2018
HY 2018 HY 2017 Change
Revenue GBP1,423m GBP1,307m +9%
Operating profit - adjusted(1) GBP31.9m GBP24.9m +28%
Profit before tax - adjusted(1) GBP30.2m GBP23.7m +27%
Earnings per share - adjusted(1) 55.6p 43.6p +28%
Period end net cash GBP97m GBP97m -
Average daily net cash GBP113m GBP132m -GBP19m
Interim dividend per share 19.0p 16.0p +19%
Operating profit - reported GBP31.6m GBP24.3m +30%
Profit before tax - reported GBP29.9m GBP23.1m +29%
Basic earnings per share - reported 55.2p 42.5p +30%
----------------------------------------- ------------ ------------ ---------
(1) 'Adjusted' is defined as before intangible amortisation (GBP0.3m)
(HY 2017: before intangible amortisation (GBP0.6m)).
HY 2018 summary:
-- Strong results reflecting strategic and operational progress across the Group
o Revenue up 9%
o Adjusted profit before tax up 27% to GBP30.2m
-- Average daily net cash of GBP113m; period end net cash of GBP97m
-- Divisional highlights
o Excellent performance from Fit Out; operating profit up 29% to
GBP18.8m
o Significant margin improvement in Construction &
Infrastructure; operating margin up to 1.7% (HY 2017: 1.1%)
reflecting focus on quality of earnings
o Regeneration: Good performance from Urban Regeneration with
profit up to GBP6.1m (HY 2017: GBP2.0m), with strong and visible
development pipeline. Partnership Housing profit lower at GBP4.6m
(HY 2017: GBP5.5m), impacted by construction cost overruns
o Property Services profit of GBP0.5m, reflecting the benefit of
increased volumes. Loss in Investments of GBP1.1m due to scheme
delays, but growing regeneration & development pipeline
-- Interim dividend up 19% to 19p per share
Commenting on today's results, Chief Executive, John Morgan
said:
"I am pleased to report another strong set of results, which
demonstrate the considerable operational and strategic progress
made across the Group. Fit Out and Construction &
Infrastructure have both continued to deliver margin and profit
growth, which has been complemented by a good performance from
Urban Regeneration. There remain a significant number of
opportunities in regeneration and our strong balance sheet and cash
position leave us well-placed to invest further in this key
strategic area.
Based upon its current trading patterns and order book
visibility, the second half outlook for Fit Out is very positive
and as a result of this, the Group is on track to deliver a result
for the year which is slightly ahead of its previous
expectations."
Enquiries
Morgan Sindall Group Tel: 020 7307 9200
John Morgan
Steve Crummett
Instinctif Partners Tel: 020 7457 2020
Matthew Smallwood
Helen Tarbet
Rosie Driscoll
Presentation
-- There will be an analyst and investor presentation at 09.00
at Instinctif Partners, 65 Gresham Street, London EC2V 7NQ. Coffee
and registration will be from 08.30
-- A copy of these results is available at www.morgansindall.com
-- Today's presentation will be available via live webcast from
09.00 at www.morgansindall.com. A recording will also be available
via playback in the afternoon.
Note to Editors
Morgan Sindall Group
Morgan Sindall Group plc is a leading UK Construction &
Regeneration group with annual revenue of GBP2.8bn, employing
around 6,400 employees and operating in the public, regulated and
private sectors. It reports through six divisions of Construction
& Infrastructure, Fit Out, Property Services, Partnership
Housing, Urban Regeneration and Investments.
Group Strategy & Structure
The Group's strategy is focused on its well-established core
strengths of Construction and Regeneration in the UK. The Group has
a balanced business which is geared toward the increasing demand
for affordable housing, urban regeneration and infrastructure
investment.
Under the two business activities of Construction and
Regeneration, the Group is organised into six divisions as
follows:
Construction activities comprise the following operations:
-- Construction & Infrastructure: Focused on the highways,
rail, aviation, energy, water and nuclear markets in
Infrastructure; and on the education, healthcare, defence,
commercial, industrial, leisure and retail markets in
Construction
-- Fit Out: Focused on the fit out of office space with
opportunities in commercial, central and local government offices,
further education and retail banking
-- Property Services: Focused on response and planned
maintenance activities provided to social housing and the public
sector
Regeneration activities comprise the following operations:
-- Partnership Housing: Focused on working in partnerships with
local authorities and housing associations. Activities include
mixed-tenure developments, building and developing homes for open
market sale and for social/affordable rent, 'design & build'
contracting and planned maintenance & refurbishment
-- Urban Regeneration: Focused on transforming the urban
landscape through partnership working and the development of
multi-phase sites and mixed-use regeneration
In addition, Investments is focused on providing the Group with
both construction and regeneration opportunities through various
strategic partnerships to develop under-utilised property assets
and generates development profits from such partnerships.
In February 2017, the Group announced a set of medium-term
financial targets for each division (the 'target' or 'targets').
These targets relate to operating margin, return on capital
employed or profit and are referenced in the divisional sections of
the Business Review as appropriate.
Basis of Preparation
For HY 2018, the term 'adjusted' excludes the impact of
intangible amortisation of GBP0.3m (HY 2017: intangible
amortisation of GBP0.6m).
Group Operating Review
The positive momentum across the Group coming into 2018 has
continued throughout the first half and has driven another strong
period of growth. Group revenue increased by 9% up to GBP1,423m (HY
2017: GBP1,307m), while adjusted operating profit increased 28% to
GBP31.9m (HY 2017: GBP24.9m). Operating margin increased to 2.2%,
up 30 bps from the prior year period (HY 2017: 1.9%).
The Group has again made considerable operational and strategic
progress in its activities and markets.
On a divisional basis, Construction & Infrastructure made
significant progress with its focus on quality of earnings and
contract selectivity, with its margin improving to 1.7% (HY 2017:
1.1%). This resulted in operating profit of GBP11.3m, up 49% on the
prior year with revenue down 5% to GBP662m.
Fit Out delivered another excellent performance, with revenue,
profit, and margin all increasing. Revenue grew 26% to GBP426m,
while profit increased by 29% to GBP18.8m at a margin of 4.4% (HY
2017: 4.3%).
Profit from Urban Regeneration of GBP6.1m was a significant
increase on the prior year (HY 2017: GBP2.0m), underpinning the
Group's regeneration strategy. However, performance in Partnership
Housing was disappointing, with profit down 16% to GBP4.6m (HY
2017: GBP5.5m) primarily impacted by one poor performing
contracting project in London. Property Services contributed a
small profit of GBP0.5m, benefiting from increased volumes, while
Investments made a loss of GBP1.1m as a result of slippage in the
timing of a number of its key developments.
The net finance expense increased to GBP1.7m (HY 2017: GBP1.2m),
with the increase including a charge of GBP0.6m arising from the
adoption of IFRS 16 and including the impact of higher interest
payable on non-recourse project financing for Urban
Regeneration.
This resulted in adjusted profit before tax of GBP30.2m, up 27%
(HY 2017: GBP23.7m). The statutory profit before tax was GBP29.9m,
an increase of 29% (HY 2017: GBP23.1m).
The tax charge of GBP5.4m broadly equates to tax at the UK
statutory rate.
The adjusted earnings per share of 55.6p was up 28% on the prior
year (HY 2017: 43.6p), while the statutory earnings per share was
55.2p (HY 2017: 42.5p).
The Group continues to apply strictly its definitions as to what
is reported in its committed order book and regeneration &
development pipeline (see Business Review).
The Group's order book at 30 June 2018 was GBP3,604m, 6% lower
than at the start of the year. Key movements within this included
Fit Out, which grew its order book by 6% to GBP528m, while
Construction & Infrastructure was 5% lower at GBP1,761m,
reflecting its contract selectivity in line with its strategic
focus on quality of earnings and risk management. Partnership
Housing was down 20% to GBP418m, reflecting a lower level of
activity in its contracting activities.
In Regeneration, the Group's regeneration and development
pipeline increased 5% to GBP3,386m. Within this, Investments
increased its regeneration pipeline by 62%, up to GBP516m. This
includes only GBP113m of work which currently meets the criteria
for inclusion from the new property partnership joint venture with
Hertfordshire County Council which was announced in the period.
Over the course of the 15 year partnership, the ambition is to
develop approximately 40 sites with an estimated gross development
value in total of GBP2bn.
The Group's balance sheet remains strong. Net cash at the period
end was GBP97m (HY 2017: GBP97m).
Importantly, the average daily net cash in the period was
GBP113m, which included GBP33m of non-recourse debt relating to
specific projects in Urban Regeneration. Based upon current plans,
it is expected that the average daily net cash will be in excess of
GBP80m for the full year. Looking further ahead in the medium term,
as the Group continues to invest across its Regeneration
businesses, the Group plans to maintain an overall average daily
net cash position.
Over the last twelve month period to 30 June 2018, there has
been an operating cash inflow of GBP69.6m, which represents a
conversion from operating profit of 92%, and a free cash inflow of
GBP57.6m. For the half year period, there was an operating cash
outflow of GBP57.9m (HY 2017: outflow of GBP86.5m) and a free cash
out flow of GBP65.8m (HY 2017: outflow of GBP96.3m). This outflow
in the half year includes the impact of the planned increase in the
investment capital employed in the regeneration activities of Urban
Regeneration and Partnership Housing of cGBP60m.
The interim dividend has been increased by 19% to 19.0p per
share (HY 2017: 16.0p), reflecting the current performance, the
strong balance sheet position and the Board's confidence in the
future prospects of the Group.
Outlook
Based upon its current trading patterns and order book
visibility, the second half outlook for Fit Out is very positive
and as a result of this, the Group is on track to deliver a result
for the year which is slightly ahead of its previous
expectations.
Business Review
The following Business Review is given on an adjusted basis,
unless otherwise stated.
Headline results by business segment
Revenue Operating Profit/(Loss) Operating Margin
GBPm change GBPm change % change
------ ------- ------------ ------------ -------- ---------
Construction & Infrastructure 662 -5% 11.3 +49% 1.7% +60bps
Fit Out 426 +26% 18.8 +29% 4.4% +10bps
Property Services 49 +58% 0.5 +67% 1.0% -
Partnership Housing 231 +16% 4.6 -16% 2.0% -80bps
Urban Regeneration 62 -13% 6.1 +205% n/a n/a
Investments 3 n/a (1.1) n/a n/a n/a
Central/Eliminations (10) (8.3)
------ ------- ------------ ------------ -------- ---------
Total 1,423 +9% 31.9 +28% 2.2% +30bps
------ ------- ------------ ------------ -------- ---------
Order book and regeneration & development pipeline
The Group's committed order book(1) at 30 June 2018 was
GBP3,604m, a decrease of 6% from the year end position. The
divisional split is shown below.
HY 2018 FY 2017 Change
GBPm GBPm
------------------------------- ------- ------- ------
Construction & Infrastructure 1,761 1,855 -5%
Fit Out 528 500 +6%
Property Services 777 836 -7%
Partnership Housing 418 523 -20%
Urban Regeneration 115 141 -18%
Investments 7 7 -
Inter-divisional eliminations (2) (13)
------------------------------- ------- ------- ------
Group committed order book 3,604 3,849 -6%
------------------------------- ------- ------- ------
(1) "Committed order book" comprises the secured order book and
framework order book. The secured order book represents the Group's
share of future revenue that will be derived from signed contracts
or letters of intent. The framework order book represents the
Group's expected share of revenue from the frameworks on which the
Group has been appointed. This excludes prospects where
confirmation has been received as preferred bidder only, with no
formal contract or letter of intent in place.
Specific to the Group's regeneration businesses only, the
regeneration & development pipeline(2) was GBP3,386m, up 5% on
the year end position.
HY 2018 FY 2017
GBPm GBPm Change
------- -------
Partnership Housing 744 851 -13%
Urban Regeneration 2,126 2,063 +3%
Investments 516 319 +62%
---------------------------------- ------- ------- ------
Group regeneration & development
pipeline 3,386 3,233 +5%
---------------------------------- ------- ------- ------
(2) "Regeneration & development pipeline" represents the
Group's share of the gross development value of secured schemes
including the development value of open market housing schemes.
Construction & Infrastructure
HY 2018 HY 2017 Change
GBPm GBPm
-------------------------------- ------- ------- ------
Revenue 662 694 -5%
Operating profit - adjusted 11.3 7.6 +49%
Operating margin - adjusted 1.7% 1.1% +60bps
-------------------------------- ------- ------- ------
Divisional revenue of GBP662m was down 5% on the prior year (HY
2017: GBP694m). Split by activity, Construction (including Design)
('Construction') accounted for 52% of divisional revenue at
GBP342m, which was down 16% compared to the prior year, while
Infrastructure (48% of divisional revenue) increased 12% to
GBP320m.
Operating profit increased significantly to GBP11.3m, up 49%,
with further improvement in the operating margin of 60bps, up to
1.7%. In line with the strategy of focusing on quality of earnings,
the division is expected to see further margin progression in the
second half.
Construction's operating margin for the period was 1.7%, up
70bps from 1.0% in the prior year period. This was achieved by the
continued focus on contract selection, risk management and project
delivery and resulted in operating profit for the period of
GBP5.8m. Infrastructure delivered operating profit of GBP5.5m in
the period, reflecting good margin growth up 50bps to 1.7% (HY
2017: 1.2%) and reflected the benefit of the increase in revenue
and the work mix in the period.
The committed order book for the division at the period end was
GBP1,761m, down 5% from the year end position. The Construction
order book of GBP452m was down 5%, as was the Infrastructure order
book, down to GBP1,309m. Consistent with its focus on contract
selectivity, the appropriate risk profile has been maintained
within the Construction order book, with 93% of the value derived
through negotiated, framework or two-stage bidding procurement
processes (HY 2017: 87%), and only 7% derived through competitive
tenders (HY 2017: 13%). Based upon this and progress to date, the
revised medium-term target for Construction is an operating margin
of 2.5% (previous target of 2%).
In Construction, the focus remains on improving its quality of
earnings through contract selectivity and operational delivery. In
the education sector, ongoing projects include the delivery of a
new GBP20m Mathematics and Science building for Warwick University,
the GBP35m Tonyrefail education campus in South Wales and a GBP45m
Arts and Humanities facility for the Manchester Metropolitan
University. In other sectors, ongoing projects include the GBP18m
new build office and laboratory refurbishment for The Centre for
the Environment, Fisheries & Aquaculture Science (CEFAS) in
Suffolk.
Work won in the period includes a GBP46m mixed use development
in Leicester and an GBP18m project to deliver new academic offices
for the University of Birmingham, as well as the appointment to the
GBP1.1bn Scape Group Regional Construction Framework which will
provide construction services for public sector projects across the
Midlands and East of England. In addition, Construction has been
appointed to the GBP750m Select Property Group framework which will
deliver new student accommodation facilities across the UK, with
the first award under this framework being for the GBP25m
development at the Old BBC Pebble Mill site in Birmingham.
In Infrastructure, the focus remains on the key sectors of
Aviation, Highways, Rail, Nuclear, Energy and Water.
In Aviation, current work undertaken at Heathrow Airport as part
of the Q6 framework (to which the division was appointed in 2014
and which runs until 2020) includes projects to replace the
pavement and ground lighting on the airfield's Alpha North taxiway,
with the works being delivered in phases to allow continued use of
the area for aircraft departing the Northern Runway. In Highways,
work completed on the final stage of the A1(M) Leeming to Barton
upgrade, while in Rail, the division completed its works on the
Edinburgh to Glasgow Improvement Programme (EGIP) on behalf of
Network Rail.
In the Energy sector, work has continued on the four year
engineer, procure, construct (EPC) onshore electricity cable
framework with National Grid, to which the division was appointed
in 2016. Projects awarded under the framework typically vary in
value between GBP2m-GBP50m, however the division is currently
preferred bidder on the cGBP80m Visual Impact Provision (VIP)
Dorset project which will see electricity cables undergrounded
across the region in order to reduce the visual impact on the area.
In the Nuclear sector, a key business win during the period was the
securing of a place on the 10 year Clyde Commercial framework for
the Defence Infrastructure Organisation (DIO) on behalf of the
Ministry of Defence. In addition, in Water the division continues
to deliver the seven-year joint venture project to build the west
section of the Thames Tideway Tunnel 'super-sewer'.
Fit Out
HY 2018 HY 2017 Change
GBPm GBPm
----------------------------- ------- ------- ------
Revenue 426 339 +26%
Operating profit - adjusted 18.8 14.6 +29%
Operating margin - adjusted 4.4% 4.3% +10bps
----------------------------- ------- ------- ------
Fit Out delivered another excellent result in the period, with
growth in revenue, profit and margin. Revenue increased by 26% to
GBP426m (HY 2017: GBP339m), with operating profit up 29% to
GBP18.8m (HY 2017: GBP14.6m) and operating margin increasing to
4.4% (HY 2017: 4.3%). Key drivers of performance remain strong
operational delivery, a focus on customer experience and a high
quality workload.
Of the revenue in the period, 80% related to the London region,
up from 67% in the prior year period, with other regions at 20% (HY
2017: 33%). This equated to growth of some 50% in the London
region, driven by ongoing activity on a small number of larger
projects which included the fit out of Deloitte's UK headquarters
at New Street Square, London comprising of c276,000 sq. ft. of
office space.
Split by type of work, there was a slightly higher weighting
towards traditional fit out work, which accounted for 87% of
revenue (HY 2017: 83%), while 13% related to 'design and build' (HY
2017: 17%). In terms of the nature of work undertaken, the
proportion of revenue generated from new office fit out increased
to 45% (HY 2017: 34%), also driven by the small number of larger
projects referred to above, while the fit out of existing office
space reduced to 55% (HY 2017: 66%). Of the fit out of existing
office space, 66% related to refurbishment 'in occupation'.
By sector, the commercial office market remains the largest,
contributing 86% of revenue (HY 2017: 83%), with higher education
at 6% of revenue, retail banking at 3%, and government and local
authority work making up the remainder.
The committed order book at 30 June was GBP528m, up 6% from the
year end position (FY 2017: GBP500m), however down 7% from the
prior year position (HY 2017: GBP568m).
Of this, GBP320m (61%) relates to the second half of the year.
The equivalent amount at 30 June 2017 which related to the second
half of 2017 was GBP325m. The remaining GBP208m (39%) relates to
2019 and beyond and the equivalent amount at 30 June 2017 which
related to 2018 and beyond was GBP243m. This implies 14% lower
visibility for future years than at the same time last year.
New contract wins in the period include the appointment to the
Department of Work & Pensions Estates Contractor Framework for
the London & South East, Scotland and The North East and the
fit out and upgrading of 27 storeys including existing office
floors and roof repairs for Royal Dutch Shell on London's
Southbank. In addition, the division is working with National Grid
at their headquarters in Warwick to complete a phased refurbishment
in occupation of c50,000 sq ft of office space.
Based upon the financial and operational performance in first
half, together with the forward visibility provided by the order
book for the second half of the year, it is now anticipated that
the divisional result for the year will be higher than previously
expected. Further, the revised medium-term target is to deliver
annual profit in the range of GBP30m - GBP35m through the cycle
(previous target of GBP25m - GBP30m).
Property Services
HY 2018 HY 2017 Change
GBPm GBPm
----------------------------- ------- ------- ------
Revenue 49 31 +58%
Operating profit - adjusted 0.5 0.3 +67%
Operating margin - adjusted 1.0% 1.0% -
----------------------------- ------- ------- ------
Property Services performed well in the period, with revenue up
58% to GBP49m and operating profit up 67% to GBP0.5m.
Revenue growth was driven both by new contract wins and by an
increase in the scope on various existing contracts, primarily
being integrated services works for City West Homes and Basildon
and planned works for the London Borough of Camden. This has
resulted in the division now delivering repairs and maintenance
services for more than 160,000 homes, together with a significantly
higher level of planned maintenance activity.
Operating profit of GBP0.5m reflected the benefit of the
additional contribution from the higher revenue together with the
positive impact of a more efficient overhead structure arising from
last year's restructuring.
The committed order book of GBP777m, represents an increase of
10% compared to the prior year, although down 7% from the year end
position. The strategy remains focusing on long term, 10 year plus,
integrated contracts which can deliver sustainable profitable
growth. The number of identified market opportunities is strong,
with the division currently involved in live integrated tenders
with aggregate value of some GBP670m.
Partnership Housing
HY 2018 HY 2017 Change
GBPm GBPm
------------------------------- ------- ------- ------
Revenue 231 200 +16%
Operating profit - adjusted 4.6 5.5 -16%
Operating margin - adjusted 2.0% 2.8% -80bps
Average capital employed(1)
(last 12 months) 103.5 94.6
Capital employed(1) at period
end 118.2 102.4
------------------------------- ------- ------- ------
Revenue increased by 16% in the period up to GBP231m, driven by
growth in the mixed-tenure activities. Mixed-tenure revenue (38% of
divisional total) was up 50% to GBP87m (HY 2017: GBP58m) and
benefited from a number of open market unit completions carried
over from the fourth quarter of last year. Contracting revenue
(including planned maintenance and refurbishment) was up 1% to
GBP144m (62% of divisional total).
In mixed-tenure, 357 units (HY 2017: 315) were completed across
open market sales and social housing at an average sales price of
GBP244k (HY 2017: GBP184k).
Despite the increase in revenue, operating profit reduced to
GBP4.6m, down 16%, with the operating margin down to 2.0% (HY 2017:
2.8%). Profit was impacted in the period by cost and programme
delivery issues in Contracting. The mixed-tenure development
activities continued to perform as planned.
As previously reported, the division experienced cost escalation
on one 'design & build' contract in London in the second half
of 2017 and these issues have continued through into the first half
impacting results. The contract is due to be completed in the third
quarter of the year.
A new senior management team has been appointed to drive the
strategic and financial development of the division as well as
improving the operational performance of the contracting
activities.
Key projects in the period include the commencement of
construction on the GBP41m development for Homes England at
Priorslee, Telford, which will create 220 affordable and open
market homes and a GBP45m joint venture project with Homes England
at Leyland, Lancashire, to build 200 homes through the accelerated
Construction Programme. In addition, the division has recently been
selected by Liverpool city Council's new housing company,
Foundations, to build the first homes set to be delivered through
Foundations' major new-build programme.
The capital employed at period end was GBP118.2m, an increase of
GBP30.2m since the year end position (FY 2017: capital employed
GBP88.0m) and an increase of GBP15.8m from the prior year position
(HY 2017: capital employed GBP102.4m). The average capital employed
for the last 12-month period was GBP103.5m resulting in an overall
ROCE(2) of 13% (HY 2017: ROCE(2) of 15%). Capital employed is
expected to remain at current levels of cGBP120m for the rest of
the year.
The order book has reduced to GBP418m from the start of the year
(FY 2017: GBP523m) and reflects the lower level of activity in the
contracting activities. The regeneration and development pipeline
decreased 13% to GBP744m, however the level of visible
opportunities which don't yet meet the strict criteria for
inclusion in the regeneration pipeline remains significant.
(1) Capital employed is calculated as total assets (excluding
goodwill, intangibles and cash) less total liabilities (excluding
corporation tax, deferred tax, inter-company financing and
overdrafts).
(2) Return On Average Capital Employed = Adjusted operating
profit divided by average capital employed.
Urban Regeneration
HY 2018 HY 2017 Change
GBPm GBPm
------------------------------- ------- ------- ------
Revenue 62 71 -13%
Operating profit - adjusted 6.1 2.0 +205%
Average capital employed(1)
(last 12 months) 102.1 79.4
Capital employed(1) at period
end 114.0 88.7
------------------------------- ------- ------- ------
Urban Regeneration delivered a strong performance in the period,
with operating profit of GBP6.1m well up on the prior year (HY
2017: GBP2.0m) resulting from the high level of current activity
across the division's development portfolio.
The main contributors to performance in the period were ongoing
development profit on a pre-let and forward sold 361,000 sq ft
distribution hub at Logic Leeds; development profit on a forward
sold 100,000 sq ft headquarters office building pre-let to Conwy
County Borough Council; and profit shares on both a residential
land sale in Crewe and on the sale of a distribution warehouse at
the Eurocentral commercial development, near Motherwell.
In addition, development management fees were generated from the
New Bailey development, part of the Salford regeneration scheme
managed by English Cities Fund (ECf), a joint venture with Legal
& General and Homes England, and from the Warrington Time
Square development scheme.
Capital employed at the period end was GBP114.0m, which
represented an increase of GBP29.0m from the year end position of
GBP85.0m and an increase of GBP25.3m over the prior year period
end. Average capital employed for the last 12-month period was
GBP102.1m, with an overall ROCE(2) of 12%. Average capital employed
is expected to be within the range of GBP100m-GBP110m for the full
year.
The market opportunity for the division remains sizeable and a
second half weighting to results is expected based upon the current
scheduled development completions. The combined regeneration and
development pipeline (GBP2.1bn) and committed order book (GBP115m),
together totalling GBP2,241m was up 2% from the year end
position.
(1) Capital employed is calculated as total assets (excluding
goodwill, intangibles and cash) less total liabilities (excluding
corporation tax, deferred tax, inter-company financing and
overdrafts).
(2) Return On Average Capital Employed = (Adjusted operating
profit less interest/fees on non-recourse debt in the last twelve
months) divided by (average capital employed). Interest and fees on
non-recourse debt in the last twelve months was GBP2.2m.
Investments
HY 2018 HY 2017 Change
GBPm GBPm
------------------------------------ ------- ------- ------
Operating (loss)/profit - adjusted (1.1) 0.6 n/a
------------------------------------ ------- ------- ------
Investments reported a loss in the period of GBP1.1m. Whilst
returns were generated from its established partnerships, most
notably from developments through its partnerships with Slough
Borough Council and Bournemouth Borough Council, these were lower
than anticipated due to key milestones on a number of schemes being
delayed. Based upon current schedules and plans, it is now expected
that division will show a loss for the full year.
A key benefit of the division is to provide high quality
construction and regeneration work for other parts of the Group and
during the period, GBP58m of construction and regeneration work on
schemes sourced by Investments was delivered across the Group
(primarily by Construction & Infrastructure).
Capital employed at the period end was GBP41.8m (HY 2017:
GBP27.4m), an increase of GBP3.2m from the year end (FY 2017:
capital employed GBP38.6m).
The division was successful in establishing a new property
partnership in the period through a joint venture with
Hertfordshire County Council. The partnership is for an initial
15-year term, with the option to extend by a further 5 years and
has an ambition to develop approximately 40 sites with an estimated
gross development value of GBP2bn.
The regeneration & development pipeline of GBP516m was up
62% from the year end position (FY 2017: GBP319m). Of the increase,
GBP113m relates to Hertfordshire, being 50% of the GDV of the
initially identified sites which meet the criteria for inclusion in
the regeneration pipeline. The overall future opportunity remains
significant.
Other Financial Information
1. Net finance expense. Net finance expense was GBP1.7m, a
GBP0.5m increase versus HY 2017. This included a charge of GBP0.6m
which related to the interest expense on lease liabilities under
IFRS 16 which was adopted in the period as well as the impact of
higher interest payable on non-recourse project financing for Urban
Regeneration.
HY 2018 HY 2017 % change
GBPm GBPm
--------------------------------------- ------- -------- --------
Interest payable on project
financing & other debt (0.9) (0.2) -350%
Amortisation of bank fees &
non-utilisation fees (1.1) (1.4) +21%
Interest expense on lease liabilities (0.6) - n/a
Interest from JVs 1.0 0.6 +67%
Other (0.1) (0.2) +50%
Total net finance expense (1.7) (1.2) -42%
--------------------------------------- ------- -------- --------
2. Tax. A tax charge of GBP5.4m is shown for the period (HY
2017: GBP4.4m).
HY 2018 HY 2017
GBPm GBPm
------------------------------------ ------- -------
Profit before tax 29.9 23.1
Less: share of net profit in taxed
joint ventures(1) (0.3) -
Profit before tax excluding joint
ventures 29.6 23.1
Statutory tax rate 19.0% 19.25%
Current tax charge at statutory
rate (5.6) (4.4)
Other adjustments 0.2 -
Tax charge (5.4) (4.4)
------------------------------------ ------- -------
(1) Certain of the Group's joint ventures are partnerships where
profits are taxed within the Group rather than the joint
venture.
3. Net working capital. 'Net Working Capital' is defined as
'Inventories plus Trade & Other Receivables, less Trade &
Other Payables' adjusted as below.
Change
HY 2018 HY 2017 GBPm
GBPm GBPm
------------------------------ ------- --------
Inventories 316.7 270.9 +45.8
Trade & Other Receivables(1) 487.7 428.5 +59.2
Trade & Other Payables(2) (885.8) (786.2) -99.6
Net working capital (81.4) (86.8) +5.4
------------------------------ ------- -------- -------
(1) Adjusted to exclude capitalised arrangement fees (GBP1.1m)
(HY 2017: GBP1.6m) and derivative financial assets (GBPnil) (HY
2017: GBP2.0m).
(2) Adjusted to exclude deferred consideration payable (GBPnil)
(HY 2017: GBP7.5m), accrued interest (GBP0.2m) (HY 2017: GBP0.2m)
and derivative financial liabilities (GBPnil) (HY 2017:
GBP1.3m).
4. Cash flow. Operating cash flow for the 12 months to 30 June
2018 was an inflow of GBP69.6m and a free cash inflow of GBP57.6m.
For the half year period to 30 June 2018, there was an operating
cash outflow of GBP57.9m (HY 2017: outflow GBP86.5m).
HY 2018 HY 2017 Last 12
GBPm GBPm months
-------------------------------------- ------- -------- -------
Operating profit - adjusted 31.9 24.9 75.6
Depreciation 8.5 2.5 11.6
Share option expense 3.1 2.0 6.6
Movement in fair value of shared
equity loans (0.2) (0.3) (0.4)
Share of net profit of joint
ventures (1.1) (2.0) (3.2)
Other operating items (1) 2.6 4.3 4.4
Change in working capital(2) (94.8) (116.8) (15.8)
Net capital expenditure (including
repayment of finance leases) (8.9) (1.7) (13.3)
Dividends and interest received
from joint ventures 1.0 0.6 4.1
Operating cash flow (57.9) (86.5) 69.6
Income taxes paid (6.6) (6.3) (9.9)
Net interest paid (non-joint
venture) (1.3) (3.5) (2.1)
Free cash flow (65.8) (96.3) 57.6
-------------------------------------- ------- -------- -------
(1) 'Other operating items' includes provision movements
(GBP1.7m), shared equity redemptions (GBP1.1m) less gain on
disposals (GBP0.2m).
(2) The cash flow for the last 12 months due to a change in
working capital excludes a net GBP10.4m comprising: non-cash
movement from the change in accounting policy (GBP11.7m), unwind of
discounting on land creditors (GBP0.8m), and exchange differences
on the translation of overseas operation (GBP0.3m) offset by a
non-cash transfer of freehold land and buildings from property,
plant and equipment to inventories (GBP2.4m).
5. Net cash. Net cash at the period end was GBP96.9m, as a
result of a net cash outflow of GBP96.5m.
GBPm
------
Net cash as at 1 January
2018 193.4
Free cash flow (as above) (65.8)
Dividends (12.9)
Other(1) (17.8)
Net cash as at 30 June 2018 96.9
-------------------------------- ------
(1) 'Other' includes net loans advanced to JVs (GBP11.6m),
deferred consideration paid in relation to the acquisition of a
joint venture and other investment (GBP2.2m), purchase of shares in
the Company by the employee benefit trust (GBP9.5m), proceeds from
the issue of new shares (GBP3.8m), and proceeds from the exercise
of share options (GBP1.7m).
6. Capital employed by strategic activity. An analysis of the
negative capital employed in the Construction activities shows a
decrease of GBP48.0m since the previous year, split as follows:
Capital employed(1) in Construction HY 2018 HY 2017 Change
GBPm GBPm GBPm
-------- --------
Construction & Infrastructure (235.3) (193.2) -42.1
Fit Out (49.8) (42.9) -6.9
Property Services 11.1 10.1 +1.0
------------------------------------- -------- -------- -------
(274.0) (226.0) -48.0
------------------------------------- -------- -------- -------
An analysis of capital employed in the Regeneration activities
shows an increase of GBP41.1m since the previous year, split as
follows:
Capital employed(1) in Regeneration HY 2018 HY 2017 Change
GBPm GBPm GBPm
-------- --------
Partnership Housing(2) 118.2 102.4 +15.8
Urban Regeneration(2) 114.0 88.7 +25.3
232.2 191.1 +41.1
-------- --------
(1) Total assets (excluding goodwill, intangibles, inter-company
financing and cash) less total liabilities (excluding corporation
tax, deferred tax, inter-company financing and overdrafts).
(2) Definition as per the Partnership Housing and Urban
Regeneration sections in the Business Review.
7. Dividends. The Board of Directors has proposed an interim
dividend of 19.0p per share (HY 2017: 16.0p), up 19% on the prior
year. This will be paid on 29 October 2018 to shareholders on the
register at 12 October 2018. The ex-dividend date will be 11
October 2018.
8. Changes in Accounting Policies. The Group adopted the
following accounting standards on 1 January 2018:
8.1 IFRS 9 'Financial instruments'. Introduces changes to the
classification and measurement of financial assets, hedge
accounting and the model to be applied when assessing whether
financial assets are impaired. This has resulted in an impairment
provision of GBP2.3m being recognised in relation to loans that
were part of the Group's long-term interests in a PFI joint venture
and trade and other receivables. The net effect on opening reserves
at 1 January 2018 was GBP1.9m net of deferred tax adjustments.
8.2 IFRS 15 'Revenue from contracts with customers'. Introduces
a new model for revenue recognition based on the satisfaction of
performance obligations. For the Group there are three main areas
of change: a greater degree of certainty is required to recognise
variable revenue in relation to liquidated damage deductions,
revenue for forward-sold, pre-let developments is recognised over
time rather than at a point in time where certain conditions are
met, and the costs of fulfilling a contract are only capitalised
where they are expected to be recovered over the duration of the
work and the Group has a contractual entitlement to recover them in
the event of a no-fault termination. The effect of these changes on
opening reserves at the date of transition was GBP9.8m net of
deferred tax adjustments.
8.3 IFRS 16 'Leases'. Requires a right-of-use asset and lease
liability to be recognised in respect of all leases other than
those that are less than one year in duration or of a low value.
The effect of this for the Group has been to recognise a
right-of-use asset of GBP42.9m and lease liability of GBP43.4m at
the transition date of 1 January 2018. The Group has taken
advantage of the practical expedients to grandfather previous
conclusions under IAS 17 on which contracts contain leases, to
apply the cumulative catch up approach rather than full
retrospective application and to measure the right-of-use asset at
an amount equal to the lease liability (adjusted for accruals and
prepayments) at transition date.
Cautionary forward-looking statement
These results contain forward-looking statements based on
current expectations and assumptions. Various known and unknown
risks, uncertainties and other factors may cause actual results to
differ from any future results or developments expressed or implied
from the forward-looking statements. Each forward-looking statement
speaks only as of the date of this document. The Group accepts no
obligation to publicly revise or update these forward-looking
statements or adjust them to future events or developments, whether
as a result of new information, future events or otherwise, except
to the extent legally required.
Condensed consolidated income statement
For the six months ended 30 June 2018
Six months Six months
to to Year ended
30 June 2018 30 June 2017 31 Dec 2017
(unaudited) (unaudited) (audited)
Notes GBPm GBPm GBPm
------------------------------------- ----- ------------ ------------ -----------
Revenue 2 1,422.6 1,307.3 2,792.7
Cost of sales (1,276.4) (1,177.5) (2,518.3)
------------------------------------- ----- ------------ ------------ -----------
Gross profit 146.2 129.8 274.4
Administrative expenses (115.4) (106.9) (209.9)
Share of net profit of joint
ventures 1.1 2.0 4.1
Operating profit before amortisation
of intangible assets 31.9 24.9 68.6
----- ------------ ------------
Amortisation of intangible assets (0.3) (0.6) (1.2)
------------------------------------- ----- ------------ ------------ -----------
Operating profit 31.6 24.3 67.4
Finance income 1.2 0.8 1.6
Finance costs (2.9) (2.0) (4.1)
------------------------------------- ----- ------------ ------------ -----------
Profit before tax 29.9 23.1 64.9
Tax 1 (5.4) (4.4) (12.5)
------------------------------------- ----- ------------ ------------ -----------
Profit for the period 24.5 18.7 52.4
------------------------------------- ----- ------------ ------------ -----------
Attributable to:
Owners of the Company 24.5 18.7 52.4
------------------------------------- ----- ------------ ------------ -----------
Earnings per share
Basic 5 55.2p 42.5p 118.8p
Diluted 5 54.1p 41.0p 112.7p
------------------------------------- ----- ------------ ------------ -----------
There were no discontinued operations in either the current or
comparative periods.
Condensed consolidated statement of comprehensive income
For the six months ended 30 June 2018
Six months Six months
to to Year ended
30 June 2018 30 June 2017 31 Dec 2017
(unaudited) (unaudited) (audited)
Notes GBPm GBPm GBPm
------------------------------------ ----- ------------ ------------ -----------
Profit for the period 24.5 18.7 52.4
Items that will not be reclassified
subsequently to profit or loss:
Actuarial (loss)/gain arising
on retirement benefit obligation 10 (2.8) - 0.1
Deferred tax on retirement benefit
obligation 0.5 - -
------------------------------------ ----- ------------ ------------ -----------
(2.3) - 0.1
------------------------------------ ----- ------------ ------------ -----------
Items that may be reclassified
subsequently to profit or loss:
Foreign exchange movement on
translation of overseas operation 0.1 (0.3) (0.2)
Gains arising during the period
on cash flow hedges - 0.4 0.3
Reclassification from cash flow
hedges to the income statement (0.5) (0.7) (0.7)
Deferred tax relating to items
that may be reclassified - - 0.1
------------------------------------ ----- ------------ ------------ -----------
(0.4) (0.6) (0.5)
------------------------------------ ----- ------------ ------------ -----------
Other comprehensive expense (2.7) (0.6) (0.4)
------------------------------------ ----- ------------ ------------ -----------
Total comprehensive income 21.8 18.1 52.0
------------------------------------ ----- ------------ ------------ -----------
Attributable to:
Owners of the Company 21.8 18.1 52.0
------------------------------------ ----- ------------ ------------ -----------
Condensed consolidated balance sheet
At 30 June 2018
30 June 2018 30 June 2017 31 Dec 2017
(unaudited) (unaudited) (audited)
Notes GBPm GBPm GBPm
------------------------------- ----- ------------ ------------ -----------
Assets
Goodwill and other intangible
assets 215.5 216.4 215.8
Property, plant and equipment 57.3 15.5 14.4
Investment property 5.9 6.3 5.9
Investments in joint ventures 87.5 63.8 76.7
Other investments 1.3 - 1.3
Shared equity loan receivables 6 14.7 16.9 15.6
Retirement benefit asset 10 0.1 2.6 2.8
------------------------------- ----- ------------ ------------ -----------
Non-current assets 382.3 321.5 332.5
Inventories 316.7 270.9 295.0
Trade and other receivables 7 488.8 432.1 404.1
Cash and cash equivalents 8 139.9 112.3 221.2
Current assets 945.4 815.3 920.3
------------------------------- ----- ------------ ------------ -----------
Total assets 1,327.7 1,136.8 1,252.8
------------------------------- ----- ------------ ------------ -----------
Liabilities
Trade and other payables 9 (875.9) (793.5) (854.1)
Current tax liabilities (7.7) (5.0) (8.9)
Lease liabilities (10.3) (0.5) (0.5)
Borrowings 8 (43.0) (15.2) (27.8)
Current liabilities (936.9) (814.2) (891.3)
------------------------------- ----- ------------ ------------ -----------
Net current assets 8.5 1.1 29.0
Trade and other payables (10.1) (1.7) (9.6)
Lease liabilities (33.9) (0.4) (0.4)
Deferred tax liabilities (11.2) (12.5) (13.9)
Provisions (22.7) (21.1) (21.0)
------------------------------- ----- ------------ ------------ -----------
Non-current liabilities (77.9) (35.7) (44.9)
------------------------------- ----- ------------ ------------ -----------
Total liabilities (1,014.8) (849.9) (936.2)
------------------------------- ----- ------------ ------------ -----------
Net assets 312.9 286.9 316.6
------------------------------- ----- ------------ ------------ -----------
Equity
Share capital 2.3 2.2 2.2
Share premium account 37.5 33.8 33.8
Other reserves (0.7) (0.4) (0.3)
Retained earnings 273.8 251.3 280.9
------------------------------- ----- ------------ ------------ -----------
Equity attributable to owners
of the Company 312.9 286.9 316.6
Total equity 312.9 286.9 316.6
------------------------------- ----- ------------ ------------ -----------
Condensed consolidated cash flow statement
For the six months ended 30 June 2018
Six months Six months
to to Year ended
30 June
2018 30 June 2017 31 Dec 2017
(unaudited) (unaudited) (audited)
Notes GBPm GBPm GBPm
------------------------------------------ ----- ----------- ------------ -----------
Operating activities
Operating profit 31.6 24.3 67.4
Adjusted for:
Amortisation of intangible assets 0.3 0.6 1.2
Share of net profit of equity
accounted joint ventures (1.1) (2.0) (4.1)
Depreciation 8.5 2.5 5.6
Share option expense 3.1 2.0 5.5
Gain on disposal of property,
plant and equipment (0.2) (0.1) (0.1)
Movement in fair value of shared
equity loan receivables (0.2) (0.3) (0.5)
Disposals of investment properties - 0.3 0.7
Repayment of shared equity loan
receivables 1.1 1.8 3.3
Increase in provisions 1.7 2.3 2.2
Operating cash inflow before movements
in working capital 44.8 31.4 81.2
Increase in inventories (31.7) (57.0) (78.7)
Increase in receivables (84.7) (98.9) (71.3)
Increase in payables 21.6 39.1 112.2
------------------------------------------ ----- ----------- ------------ -----------
Movements in working capital (94.8) (116.8) (37.8)
------------------------------------------ ----- ----------- ------------ -----------
Cash (outflow)/inflow from operations (50.0) (85.4) 43.4
------------------------------------------ ----- ----------- ------------ -----------
Income taxes paid (6.6) (6.3) (9.6)
------------------------------------------ ----- ----------- ------------ -----------
Net cash (outflow)/inflow from
operating activities (56.6) (91.7) 33.8
------------------------------------------ ----- ----------- ------------ -----------
Investing activities
Interest received 1.4 0.8 1.4
Dividend from joint ventures - - 2.6
Proceeds on disposal of property,
plant and equipment 0.3 0.1 0.6
Purchases of property, plant and
equipment (1.5) (1.4) (6.3)
Net increase in loans to joint
ventures (11.6) (4.9) (14.2)
Payment for the acquisition of
subsidiaries, joint ventures and
other businesses (2.0) - (9.6)
Payment for other investments (0.2) - (1.1)
Net cash outflow from investing
activities (13.6) (5.4) (26.6)
------------------------------------------ ----- ----------- ------------ -----------
Financing activities
Interest paid (1.7) (3.7) (4.6)
Dividends paid 4 (12.9) (9.7) (16.8)
Repayments of lease obligations (7.7) (0.4) (0.4)
Proceeds from/(repayment of) borrowings 8 15.2 (4.6) 8.0
Proceeds on issue of share capital 3.8 0.1 0.1
Payments by the Trust to acquire
shares in the Company (9.5) (1.0) (1.1)
Proceeds on exercise of share options 1.7 0.2 0.3
------------------------------------------ ----- ----------- ------------ -----------
Net cash outflow from financing
activities (11.1) (19.1) (14.5)
------------------------------------------ ----- ----------- ------------ -----------
Net decrease in cash and cash equivalents (81.3) (116.2) (7.3)
Cash and cash equivalents at the
beginning of the period 221.2 228.5 228.5
------------------------------------------ ----- ----------- ------------ -----------
Cash and cash equivalents at the
end of the period 8 139.9 112.3 221.2
------------------------------------------ ----- ----------- ------------ -----------
Condensed consolidated statement of changes in equity
For the six months ended 30 June 2018
Share Share premium Other Retained Total
capital account reserves earnings equity
GBPm GBPm GBPm GBPm GBPm
--------------------------------- -------- ------------- --------- --------- -------
1 January 2018 2.2 33.8 (0.3) 280.9 316.6
Effect of change in accounting
policies (note 1) - - - (11.7) (11.7)
--------------------------------- -------- ------------- --------- --------- -------
As restated 2.2 33.8 (0.3) 269.2 304.9
Total comprehensive income - - (0.4) 22.2 21.8
Share option expense - - - 3.1 3.1
Issue of shares at a premium 0.1 3.7 - - 3.8
Exercise of share options
and vesting of share awards - - - 1.7 1.7
Purchase of shares in the
Company by the Trust - - - (9.5) (9.5)
Dividends paid - - - (12.9) (12.9)
--------------------------------- -------- ------------- --------- --------- -------
30 June 2018 (unaudited) 2.3 37.5 (0.7) 273.8 312.9
--------------------------------- -------- ------------- --------- --------- -------
Share Share premium Other Retained Total
capital account reserves earnings equity
GBPm GBPm GBPm GBPm GBPm
------------------------------- -------- ------------- --------- --------- -------
1 January 2017 2.2 33.7 0.2 241.1 277.2
Total comprehensive income - - (0.6) 18.7 18.1
Share option expense - - - 2.0 2.0
Issue of shares at a premium - 0.1 - - 0.1
Purchase of shares in the
Company by the Trust - - - (0.8) (0.8)
Dividends paid - - - (9.7) (9.7)
------------------------------- -------- ------------- --------- --------- -------
30 June 2017 (unaudited) 2.2 33.8 (0.4) 251.3 286.9
------------------------------- -------- ------------- --------- --------- -------
Share Share premium Other Retained Total
capital account reserves earnings equity
GBPm GBPm GBPm GBPm GBPm
------------------------------- -------- ------------- --------- --------- -------
1 January 2017 2.2 33.7 0.2 241.1 277.2
Total comprehensive income - - (0.5) 52.5 52.0
Share option expense - - - 5.5 5.5
Tax relating to share option
expense - - - (0.6) (0.6)
Issue of shares at a premium - 0.1 - - 0.1
Exercise of share options
and vesting of share awards - - - 0.3 0.3
Purchase of shares in the
Company by the Trust - - - (1.1) (1.1)
Dividends paid - - - (16.8) (16.8)
------------------------------- -------- ------------- --------- --------- -------
31 December 2017 (audited) 2.2 33.8 (0.3) 280.9 316.6
------------------------------- -------- ------------- --------- --------- -------
Other reserves
Other reserves include:
-- Capital redemption reserve of GBP0.6m (30 June 2017: GBP0.6m,
31 December 2017: GBP0.6m) which was created on the redemption of
preference shares in 2003.
-- Hedging reserve of (GBP0.8m) (30 June 2017: (GBP0.3m), 31
December 2017: (GBP0.3m)) arising under cash flow hedge accounting.
Movements on the effective portion of hedges are recognised through
the hedging reserve, whilst any ineffectiveness is taken to the
income statement.
-- Translation reserve of (GBP0.5m) (30 June 2017: (GBP0.7m), 31
December 2017: (GBP0.6m)) arising on the translation of overseas
operations into the Group's functional currency.
Retained earnings
Retained earnings include shares in Morgan Sindall Group plc
purchased in the market and held by the Morgan Sindall Employee
Benefit Trust to satisfy options under the Group's share incentive
schemes. The number of shares held by the Trust at 30 June 2018 was
339,627 (30 June 2017: 619,535, 31 December 2017: 555,104) with a
cost of GBP4.7m (30 June 2017: GBP4.7m, 31 December 2017:
GBP4.2m).
Notes to the consolidated financial statements
For the six months ended 30 June 2018
1 Basis of preparation
General information
The financial information for the year ended 31 December 2017
set out in this half year report does not constitute the Company's
statutory accounts as defined by section 434 of the Companies Act
2006. A copy of the statutory accounts for that year was delivered
to the Registrar of Companies. The auditor reported on those
accounts: their report was unqualified, did not draw attention to
any matters by way of emphasis without qualifying their report and
did not contain a statement under s498(2) or (3) of the Companies
Act 2006. This half year report has not been audited or reviewed by
the auditor pursuant to the Auditing Practices Board guidance on
the Review of Interim Financial Information. Figures as at 30 June
2018 and 2017 and for the six months ended 30 June 2018 and 2017
are therefore unaudited.
Basis of preparation
The annual financial statements of Morgan Sindall Group plc are
prepared in accordance with IFRSs as adopted by the European Union.
The condensed consolidated financial statements included in this
half year report were prepared in accordance with IAS 34 'Interim
Financial Reporting'. While the financial information included in
this half year report was prepared in accordance with the
recognition and measurement criteria of International Financial
Reporting Standards ('IFRS'), this half year report does not itself
contain sufficient information to comply with IFRS.
Going concern
As at 30 June 2018, the Group had net cash of GBP96.9m and total
undrawn committed banking facilities of GBP180m which are in place
for greater than one year. The directors have reviewed the Group's
forecasts and projections, and have modelled certain downside
scenarios which show that the Group will have a sufficient level of
headroom within facility limits and covenants for the foreseeable
future. After making enquiries the directors have a reasonable
expectation that the Company and the Group have adequate resources
to continue in operational existence for the foreseeable future.
Accordingly, they continue to adopt the going concern basis in
preparing the condensed consolidated financial statements.
Tax
A tax charge of GBP5.4m is shown for the six month period (six
months to 30 June 2017: GBP4.4m, year ended 31 December 2017:
GBP12.5m). This tax charge is recognised based upon the best
estimate of the average effective income tax rate on profit before
tax for the full financial year.
Seasonality
The Group's activities are generally not subject to significant
seasonal variation.
Changes in accounting policies
The Group adopted the following accounting standards on 1
January 2018:
-- IFRS 9 'Financial instruments'. Introduces changes to the
classification and measurement of financial assets, hedge
accounting and the model to be applied when assessing whether
financial assets are impaired. This has resulted in an impairment
provision of GBP2.3m being recognised in relation to loans that
were part of the Group's long-term interests in a PFI joint venture
and trade and other receivables. The net effect on opening reserves
at 1 January 2018 was GBP1.9m net of deferred tax adjustments.
-- IFRS 15 'Revenue from contracts with customers'. Introduces a
new model for revenue recognition based on the satisfaction of
performance obligations. For the Group there are three main areas
of change: a greater degree of certainty is required to recognise
variable revenue in relation to liquidated damage deductions,
revenue for forward-sold, pre-let developments is recognised over
time rather than at a point in time where certain conditions are
met, and the costs of fulfilling a contract are only capitalised
where they are expected to be recovered over the duration of the
work and the Group has a contractual entitlement to recover them in
the event of a no-fault termination. The effect of these changes on
retained earnings at the date of transition was GBP9.8m net of
deferred tax adjustments.
-- IFRS 16 'Leases'. Requires a right-of-use asset and lease
liability to be recognised in respect of all leases other than
those that are less than one year in duration or of a low value.
The effect of this for the Group has been to recognise a
right-of-use asset of GBP42.9m and lease liability of GBP43.4m at
the transition date of 1 January 2018. The Group has taken
advantage of the practical expedients to grandfather previous
conclusions under IAS 17 on which contracts contain leases, to
apply the cumulative catch up approach rather than full
retrospective application and to measure the right-of-use asset at
an amount equal to the lease liability (adjusted for accruals and
prepayments) at transition date.
The effect of the accounting policy changes on 1 January 2018
can be summarised as follows:
GBPm As previously Adjustments
reported
----------------------------- -------------- --------------------------------- ------------
IFRS 9 IFRS 15 IFRS 16 As restated
----------------------------- -------------- --------- ---------- ---------- ------------
Property, plant and
equipment 14.4 - - 42.9 57.3
Investments in joint
ventures 76.7 (1.9) - - 74.8
Inventories 295.0 - (10.0) - 285.0
Trade and other receivables 404.1 (0.4) 3.2 (0.7) 406.2
Change in total assets (2.3) (6.8) 42.2
Trade and other payables
- current (854.1) - (5.0) 1.2 (857.9)
Lease liabilities -
current (0.5) - - (10.2) (10.7)
Lease liabilities -
non-current (0.4) - - (33.2) (33.6)
Deferred tax liabilities (13.9) 0.4 2.0 - (11.5)
Change in total liabilities 0.4 (3.0) (42.2)
Change in total equity (1.9) (9.8) -
----------------------------- -------------- --------- ---------- ---------- ------------
The Group's new accounting policies are set out below. Other
than those described below, there have not been any other
significant changes to accounting policies, presentation or methods
of preparation since the Group's latest annual audited financial
statements for the year ended 31 December 2017.
Revenue and margin recognition
The principal revenue streams within the Group are as
follows:
(a) Construction and infrastructure services contracts
Construction & Infrastructure, Fit Out, Property Services,
Partnership Housing and Urban Regeneration all derive a significant
portion of their revenue from construction and infrastructure
services contracts. These services are provided to customers across
a wide variety of sectors and the size and duration of the
contracts can vary significantly from a few weeks to more than 10
years.
The majority of contracts are considered to contain only one
performance obligation for the purposes of recognising revenue.
Whilst the scope of works may include a number of different
components, in the context of construction and infrastructure
services activities these are usually highly interrelated and
produce a combined output for the customer.
Contracts are typically satisfied over time. For fixed price
construction contracts progress is measured through a valuation of
the works undertaken by a professional quantity surveyor, including
an assessment of any elements for which a price has not yet been
agreed such as changes in scope. For cost reimbursable
infrastructure services contracts progress is measured based on the
costs incurred to date as a proportion of the estimated total cost
and an assessment of the final contract price payable.
Variations are only included in the estimated total contract
price when the customer has agreed the revised scope of work. Where
the scope has been agreed but the corresponding change in price has
not yet been agreed, only the amount that is considered highly
probable not to reverse in the future is included in the estimated
total contract price. Where delays to the programme of works are
anticipated and liquidated damages would be contractually due, the
estimated total contract price is reduced accordingly. This is only
mitigated by expected extensions of time or commercial resolution
being achieved where it is highly probable that this will not lead
to a significant reversal in the future.
For cost reimbursable contracts, expected pain share is
recognised in the estimated total contract price immediately whilst
anticipated gain share and performance bonuses are only recognised
at the point that they are agreed by the customer.
In order to recognise the profit over time it is necessary to
estimate the total costs of the contract. These estimates take
account of any uncertainties in the cost of work packages which
have not yet been let and materials which have not yet been
procured, the expected cost of any acceleration of or delays to the
programme or changes in the scope of works and the expected cost of
any rectification works during the defects liability period.
Once the outcome of a construction contract can be estimated
reliably, margin is recognised in the income statement in line with
the stage of completion. Where a contract is forecast to be
loss-making, the full loss is recognised immediately in the income
statement.
(b) Service contracts
Service contracts include design, maintenance and management
services in Construction & Infrastructure, Property Services,
Urban Regeneration and Investments. Contracts are typically
satisfied over time and revenue is measured through an assessment
of time incurred and materials utilised as a proportion of the
total expected or percentage of completion depending upon the
nature of the service.
(c) Sale of land and properties
Partnership Housing, Urban Regeneration and Investments derive a
significant portion of revenue from the sale of land, and the
development and sale of residential and commercial properties.
Contracts are typically satisfied at a point in time. This is
usually deemed to be legal completion as this is the point at which
the Group has an enforceable right to payment. The only exception
to this is pre-let forward-sold developments where the customer
controls the work in progress as it is created; or where the Group
is unable to put the asset being constructed to an alternative use
due to legal or practical limitations and has an enforceable right
to payment for the work completed to date. Where these conditions
are met, the contract is accounted for as construction contract in
accordance with paragraph (a) above.
Revenue from the sale of land, residential and commercial
properties is measured at the transaction price agreed in the
contract with the customer. While deferred payment terms may be
agreed in rare circumstances, the deferral rarely exceeds twelve
months. The transaction price is therefore not adjusted for the
effects of a significant financing component. The Group no longer
utilises shared equity loan schemes for the sale of residential
properties.
Proceeds from the sale of properties taken in part exchange is
not included in revenue but is treated as a reduction in costs.
In order to recognise profit it is necessary to estimate the
total costs of a development. These estimates take account of any
uncertainties in the cost of work packages which have not yet been
let and materials which have not yet been procured and the expected
cost of any rectification works during the defects liability period
which is 12 months for commercial property and 24 months for
residential property.
Profit is recognised by allocating the total costs of a scheme
to each unit at a consistent margin. For mixed tenure schemes which
also incorporate a construction contract, the margin recognised for
the open market units is consistent with the construction contract
element of the development.
(d) Contract costs
Costs to obtain a contract are expensed unless they are
incremental, i.e. they would not have been incurred if the contract
had not been obtained, and the contract is expected to be
sufficiently profitable for them to be recovered.
Costs to fulfil a contract are expensed unless they relate to an
identified contract, generate or enhance resources that will be
used to satisfy the obligations under the contract in future years
and the contract is expected to be sufficiently profitable for them
to be recovered.
Where costs are capitalised, they are amortised over the shorter
of the period for which revenue and profit can be forecast with
reasonable certainty and the duration of the contract except where
the contract becomes loss making. If the contract becomes loss
making, all capitalised costs related to that contract are
immediately expensed.
(e) Government grants
Funding received in respect of developer grants, where funding
is awarded to encourage the building and renovation of affordable
housing, is recognised as revenue on a stage of completion basis
over the life of the project to which the funding relates.
Funding received to support the construction of housing where
current market prices would otherwise make a scheme financially
unviable is recognised as revenue on a legal completion basis when
the properties to which it relates are sold.
Government grants are initially recognised as deferred income at
fair value when there is reasonable assurance that the Group will
comply with the conditions attached and the grants will be
received.
(f) Leases
Where the Group is a lessee, a right-of-use asset and lease
liability are recognised at the outset of the lease. The lease
liability is initially measured at the present value of the lease
payments that are not paid at that date based on the Group's
expectations of the likelihood of lease extension or break options
being exercised. The lease liability is subsequently adjusted to
reflect imputed interest, payments made to the lessor and any lease
modifications. The right-of-use asset is initially measured at
cost, which comprises the amount of the lease liability, any lease
payments made at or before the commencement date, less any lease
incentives received, any initial direct costs incurred by the Group
and an estimate of any costs that are expected to be incurred at
the end of the lease to dismantle or restore the asset. The
right-of-use asset is subsequently depreciated in accordance with
the Group's accounting policy on property, plant and equipment. The
amount charged to the income statement comprises the depreciation
of the right-of-use asset and the imputed interest on the lease
liability.
2 Revenue
An analysis of the Group's revenue which depicts the nature,
timing and uncertainty of the different revenue streams is as
follows:
Six months Six months
to to Year ended
30 June 2018 30 June 2017 31 Dec 2017
GBPm GBPm GBPm
-------------------------------- ------------ ------------ -----------
Construction and design 342.2 409.1 807.3
Infrastructure 319.6 284.6 587.5
-------------------------------- ------------ ------------ -----------
Construction and Infrastructure 661.8 693.7 1,394.8
Traditional fit out 371.0 283.2 616.5
Design and build 55.4 56.1 118.4
-------------------------------- ------------ ------------ -----------
Fit Out 426.4 339.3 734.9
Property Services 48.9 31.4 66.2
Contracting 144.5 141.9 290.1
Mixed tenure 86.8 58.0 183.4
-------------------------------- ------------ ------------ -----------
Partnership Housing 231.3 199.9 473.5
Urban Regeneration 61.6 70.7 175.3
Investments 3.3 5.5 10.6
Eliminations (10.7) (33.2) (62.6)
-------------------------------- ------------ ------------ -----------
Total revenue 1,422.6 1,307.3 2,792.7
-------------------------------- ------------ ------------ -----------
3 Business segments
For management purposes, the Group is organised into six
operating divisions: Construction & Infrastructure, Fit Out,
Property Services, Partnership Housing, Urban Regeneration and
Investments. The divisions' activities are as follows:
-- Construction & Infrastructure: provides infrastructure
services in the highways, rail, aviation, energy, water and nuclear
markets, including tunnel design; and construction services in
education, healthcare, defence, commercial, industrial, leisure and
retail. BakerHicks offers a multidisciplinary design and
engineering consultancy.
-- Fit Out: Overbury specialises in fit out and refurbishment in
commercial, central and local government offices, further education
and retail banking. Morgan Lovell provides design and build
services for the office sector.
-- Property Services: provides planned asset management and
responsive maintenance to social housing and the wider public
sector.
-- Partnership Housing: works in partnerships with local
authorities and housing associations. Activities include
mixed-tenure developments, building and developing homes for open
market sale and affordable rent, design and build contracting and
planned maintenance and refurbishment.
-- Urban Regeneration: works with landowners and public sector
partners to transform the urban landscape through the development
of multi-phase sites and mixed-use regeneration, including
residential, commercial, retail and leisure.
-- Investments: works to provide the Group with construction and
regeneration opportunities through various strategic partnerships
to develop under-utilised property assets.
Group Activities represents costs and income arising from
corporate activities which cannot be meaningfully allocated to the
operating segments. These include the costs of the Group Board,
treasury management, corporate tax coordination, Group finance and
internal audit, insurance management, company secretarial services,
information technology services, interest revenue and interest
expense. The divisions are the basis on which the Group reports its
segmental information as presented below:
Six months to 30 June
2018
------------------------------ ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Construction
& Fit Property Partnership Urban Group
Infrastructure Out Services Housing Regeneration Investments Activities Eliminations Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
External
revenue 651.1 426.4 48.9 231.3 61.6 3.3 - - 1,422.6
Inter-segment
revenue 10.7 - - - - - - (10.7) -
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Total revenue 661.8 426.4 48.9 231.3 61.6 3.3 - (10.7) 1,422.6
Operating
profit/(loss)
before
amortisation
of intangible
assets 11.3 18.8 0.5 4.6 6.1 (1.1) (8.3) - 31.9
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Amortisation
of intangible
assets - - (0.3) - - - - - (0.3)
Operating
profit/(loss) 11.3 18.8 0.2 4.6 6.1 (1.1) (8.3) - 31.6
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Six months to 30 June
2017
------------------------------ ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Construction
& Fit Property Partnership Urban Group
Infrastructure Out Services Housing Regeneration Investments Activities Eliminations Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
External
revenue 660.5 339.3 31.4 199.9 70.7 5.5 - - 1,307.3
Inter-segment
revenue 33.2 - - - - - - (33.2) -
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Total revenue 693.7 339.3 31.4 199.9 70.7 5.5 - (33.2) 1,307.3
Operating
profit/(loss)
before
amortisation
of intangible
assets 7.6 14.6 0.3 5.5 2.0 0.6 (5.7) - 24.9
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Amortisation
of intangible
assets - - (0.3) (0.2) (0.1) - - - (0.6)
Operating
profit/(loss) 7.6 14.6 - 5.3 1.9 0.6 (5.7) - 24.3
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Year ended 31 December
2017
Construction
& Fit Property Partnership Urban Group
Infrastructure Out Services Housing Regeneration Investments Activities Eliminations Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
External
revenue 1,332.6 734.5 66.2 473.5 175.3 10.6 - - 2,792.7
Inter-segment
revenue 62.2 0.4 - - - - - (62.6) -
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Total revenue 1,394.8 734.9 66.2 473.5 175.3 10.6 - (62.6) 2,792.7
Operating
profit/(loss)
before
amortisation
of intangible
assets 20.4 39.1 (1.3) 14.1 10.0 0.5 (14.2) - 68.6
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
Amortisation
of intangible
assets - - (0.6) (0.4) (0.2) - - - (1.2)
Operating
profit/(loss) 20.4 39.1 (1.9) 13.7 9.8 0.5 (14.2) - 67.4
-------------- -------------- ----- -------- ----------- ------------ ----------- ---------- ------------ -------
During the period ended 30 June 2018, the period ended 30 June
2017 and the year ended 31 December 2017, inter-segment sales were
charged at prevailing market prices and significantly all of the
Group's operations were carried out in the UK.
4 Dividends
Amounts recognised as distributions to equity
holders in the period:
--------------------------------------------------- ------------ -----------
Six months Six months
to to Year ended
30 June 2018 30 June 2017 31 Dec 2017
GBPm GBPm GBPm
------------------------------------- ------------ ------------ -----------
Final dividend for the year ended
31 December 2017 of 29.0p per share 12.9 - -
Final dividend for the year ended
31 December 2016 of 22.0p per share - 9.7 9.7
Interim dividend for the year ended
31 December 2017 of 16.0p per share - - 7.1
------------------------------------- ------------ ------------ -----------
12.9 9.7 16.8
------------------------------------- ------------ ------------ -----------
The proposed interim dividend of 19.0p per share was approved by
the Board on 8 August 2018 and will be paid on 29 October 2018 to
shareholders on the register on 12 October 2018. The ex-dividend
date is 11 October 2018.
5 Earnings per share
Six months Six months
to to Year ended
30 June 2018 30 June 2017 31 Dec 2017
GBPm GBPm GBPm
----------------------------------- ------------ ------------ -----------
Profit attributable to the owners
of the Company 24.5 18.7 52.4
Adjustments:
Amortisation of intangible
assets net of tax 0.2 0.5 1.0
Adjusted earnings 24.7 19.2 53.4
------------------------------------ ------------ ------------ -----------
Basic weighted average ordinary
shares (m) 44.4 44.0 44.1
Dilutive effect of share options
and conditional shares not vested
(m) 0.9 1.6 2.4
------------------------------------ ------------ ------------ -----------
Diluted weighted average ordinary
shares (m) 45.3 45.6 46.5
------------------------------------ ------------ ------------ -----------
Basic earnings per share 55.2p 42.5p 118.8p
Diluted earnings per share 54.1p 41.0p 112.7p
Adjusted earnings per share 55.6p 43.6p 121.1p
Diluted adjusted earnings per
share 54.5p 42.1p 114.8p
------------------------------------ ------------ ------------ -----------
The average market value of the Company's shares for the purpose
of calculating the dilutive effect of share options and long-term
incentive plan shares was based on quoted market prices for the
period that the options were outstanding. The weighted average
share price for the period was GBP13.37 (30 June 2017: GBP10.38, 31
December 2017: GBP12.03).
A total of 1,072,901 share options that could potentially dilute
earnings per share in the future were excluded from the above
calculations because they were anti-dilutive at 31 December 2018
(30 June 2017: 2,263,006, 31 December 2017: 38,938).
6 Shared equity loan receivables
30 June 2018 30 June 2017 31 Dec 2017
GBPm GBPm GBPm
------------------------------------ ------------ ------------ -----------
1 January 15.6 18.4 18.4
Net change in fair value recognised
in the income statement 0.2 0.3 0.5
Repayments by borrowers (1.1) (1.8) (3.3)
------------------------------------- ------------ ------------ -----------
End of period 14.7 16.9 15.6
------------------------------------- ------------ ------------ -----------
Basis of valuation and assumptions made
There is no directly observable fair value for individual loans
arising from the sale of properties under the scheme, and therefore
the Group has developed a model for determining the fair value of
the portfolio of loans based on national property prices, expected
property price increases, expected loan defaults and a discount
factor which reflects the interest rate expected on an instrument
of similar risk and duration in the market. Details of the key
assumptions made in this valuation are as follows:
30 June 2018 30 June 2017 31 Dec 2017
---------------------------------- ------------ ------------ -----------
Assumption
Period over which shared equity
loan receivables are discounted:
First Buy and Home Buy schemes 20 years 20 years 20 years
Other schemes 9 years 9 years 9 years
Nominal discount rate 5.3% 5.4% 5.3%
Weighted average nominal annual
property price increase 2.4% 2.3% 2.4%
Forecast default rate 6.8% 2.0% 4.6%
Number of loans under the shared
equity scheme outstanding at the
period end 449 543 489
----------------------------------- ------------ ------------ -----------
The fair value measurement for shared equity loan receivables is
classified as Level 3 as defined by IFRS 7 'Financial Instruments:
Disclosures'.
Sensitivity analysis
At 30 June 2018, if the nominal discount rate had been 100bps
higher at 6.3% and all other variables were held constant, the fair
value of the shared equity loan receivables would decrease by
GBP0.3m with a corresponding reduction in both the result for the
period and equity (excluding the effects of tax).
At 30 June 2018, if the period over which the shared equity loan
receivables (excluding those relating to the First Buy and Home Buy
schemes) are discounted had been 10 years and all other variables
were held constant, the fair value of the shared equity loan
receivables would decrease by GBP0.4m with a corresponding
reduction in both the result for the period and equity (excluding
the effects of tax).
7 Trade and other receivables
30 June 2018 30 June 2017 31 Dec 2017
GBPm GBPm GBPm
------------------------------- ------------ ------------ -----------
Contract assets 236.5 200.7 174.2
Trade receivables 223.9 198.9 208.0
Amounts owed by joint ventures 1.3 1.2 2.1
Prepayments 18.2 19.6 10.2
Other receivables 8.9 11.7 9.6
-------------------------------- ------------ ------------ -----------
488.8 432.1 404.1
------------------------------- ------------ ------------ -----------
8 Net cash
30 June 2018 30 June 2017 31 Dec 2017
GBPm GBPm GBPm
-------------------------------- ------------ ------------ -----------
Cash and cash equivalents 139.9 112.3 221.2
Non-recourse project financing
due in less than one year (41.5) (15.2) (26.5)
Borrowings due in less than one
year (1.5) - (1.3)
Net cash 96.9 97.1 193.4
--------------------------------- ------------ ------------ -----------
The non-recourse project finance borrowings were drawn from
separate facilities to fund specific projects. These borrowings are
without recourse to the remainder of the Group's assets.
9 Trade and other payables
30 June
30 June 2018 2017 31 Dec 2017
GBPm GBPm GBPm
------------------------------- ------------ ------- -----------
Trade payables 201.9 200.1 162.0
Contract liabilities 98.0 60.8 58.3
Amounts owed to joint ventures 0.2 0.2 0.2
Other tax and social security 23.5 18.9 37.5
Accrued expenses 531.9 472.6 573.3
Deferred income 2.7 0.8 2.7
Other payables 17.7 40.1 20.1
-------------------------------- ------------ ------- -----------
875.9 793.5 854.1
------------------------------- ------------ ------- -----------
10 Retirement benefit asset
The Morgan Sindall Retirement Benefits Plan ('the Retirement
Plan') was established on 31 May 1995 and currently operates on
defined contribution principles for employees of the Group. The
Retirement Plan also includes a defined benefit section comprising
liabilities and transfers of funds representing the accrued benefit
rights of active and deferred members and pensioners of pension
plans of companies which are now part of the Group. These include
salary related benefits for members in respect of benefits accrued
before 31 May 1995 (and benefits transferred in from The Snape
Group Limited Retirement Benefits Scheme accrued up to 1 August
1997). No further defined benefit membership rights can accrue
after those dates. The scheme duration is an indicator of the
weighted-average time until benefit payments are expected to be
made. For the scheme as a whole, the duration is around 15
years.
On 23 May 2018 the Trustees of the Retirement Plan completed a
buy-in transaction with Aviva to insure the benefits of the Defined
Benefit members. The buy-in policy is an asset of the Plan that
provides payments that are an exact match to the pension payments
made to the Defined Benefit members covered by the policy. The
insurance policy was initially recognised as an asset at an amount
equal to its cost. It was then immediately remeasured to its fair
value in accordance with IAS 19, giving rise to an actuarial loss
of GBP2.8m, leaving an accounting surplus of GBP0.1m.
11 Contingent liabilities
Group banking facilities and surety bond facilities are
supported by cross guarantees given by the Company and
participating companies in the Group. There are contingent
liabilities in respect of surety bond facilities, guarantees and
claims under contracting and other arrangements, including joint
arrangements and joint ventures entered into in the normal course
of business.
12 Subsequent events
There were no subsequent events that affected the financial
statements of the Group.
The directors confirm that to the best of their knowledge:
-- the unaudited condensed consolidated financial statements,
which have been prepared in accordance with IAS 34 'Interim
Financial Reporting' as adopted by the European Union, give a true
and fair view of the assets, liabilities, financial position and
profit or loss of the Group as required by DTR 4.2.4R;
-- the half year report includes a fair review of the
information required by DTR 4.2.7R (indication of important events
during the first six months and description of principal risks and
uncertainties for the remaining six months of the year); and
-- the half year report includes a fair review of the
information required by DTR 4.2.8R (disclosure of related parties'
transactions and changes therein)
By order of the Board
John Morgan Steve Crummett
Chief Executive Finance Director
8 August 2018
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR LLFLDTIIDIIT
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August 08, 2018 02:00 ET (06:00 GMT)
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