Final Results

RNS Number : 1423Y

Carillion PLC

01 March 2017

 

1 March 2017

Results for the year ended 31 December 2016

Performance in line with expectations

	2016	2015	Change
Total revenue(1)	£5,214.2m	£4,586.9m	+14%
Group revenue	£4,394.9m	£3,950.7m	+11%
Underlying profit before taxation(1)	£178.0m	£176.5m	+1%
Underlying earnings per share(1)	35.3p	35.0p	+1%
Profit before taxation	£146.7m	£155.1m	-5%
Basic earnings per share	28.9p	30.9p	-6%
Proposed full-year dividend per share	18.45p	18.25p	+1%
Underlying profit from operations cash conversion(1)	117%	104%	n/a

·      Financial performance in line with expectations

·      Total revenue growth of 14 per cent, primarily organic(1)   ·      Performance led by growth in support services ·      Support services contributed over two thirds of total operating profit and more than offset expected reductions in profit from Public Private Partnership projects and Middle East construction services ·      Underlying operating margin(1) lower as expected at 4.9 per cent (2015: 5.3 per cent) ·      Underlying profit from operations(1) fully cash-backed - cash conversion(1) 117 per cent ·      Net borrowing of £218.9 million at 31 December 2016 (2015: £169.8 million) and average net borrowing(1) for 2016 of £586.5 million (2015: £538.9 million), with the increases mainly reflecting adverse movements in foreign exchange rates

·      High-quality order book and strong pipeline of contract opportunities

·      £4.8 billion of new orders and probable orders in 2016 (2015: £3.7 billion) ·      High-quality order book plus probable orders worth £16.0 billion at 31 December 2016 (2015: £17.4 billion) ·      Revenue visibility(2) for 2017 of 74 per cent (2015: 84 per cent for 2016) ·      Expect over £1.5 billion of revenue from framework agreements not yet included in orders, probable orders or revenue visibility ·      Substantial pipeline of contract opportunities worth £41.6 billion (2015: £41.4 billion)

·  Proposed full-year dividend increased by one per cent to 18.45p (2015: 18.25p)

·  Begin reducing average net borrowing over medium term

Carillion Chairman, Philip Green, commented:

"In 2016, Carillion's performance was led by revenue growth and an increased margin in support services, together with good cash flow. Given the size and quality of our order book and pipeline of contract opportunities, our customer-focused culture and integrated business model, we have a good platform from which to develop the business in 2017.  We will accelerate the rebalancing of our business into markets and sectors where we can win high-quality contracts and achieve our targets for margin and cash flows, while actively managing the positions we have in challenging markets.  We will also begin reducing average net borrowing by stepping up our ongoing cost reduction programmes and our focus on managing working capital."

(1)	Alternative Performance Measures are defined in note 15 on pages 40 to 45.
(2)	Based on expected revenue and secure and probable orders, which exclude variable work, frameworks and re-bids.

There will be a presentation for analysts and investors today at 09.00am with a telephone facility available tel: primary number [phone] - Access Code: 256001.  A replay facility is also available for 30 days, the telephone number is [phone] - Access Code: 65326681.

If dialling in from overseas, please review the link attached for your dial in telephone number http://www.conferencingsupport.com/globalaccess/?bid=00&itfn=1&ddi=1&ref.  Carillion's Analyst Presentation will be available for analysts and investors who are unable to attend the presentation. The presentation can be viewed on Carillion's website at http://www.carillionplc.com/investors/reports-presentations.aspx  

For further information contact:

Zafar Khan, Group Finance Director John Denning, Group Corporate Affairs Director

tel: [phone] tel: [phone]

1 March 2017

Notes to Editors:

Carillion is a leading integrated support services company with a substantial portfolio of Public Private Partnership projects, extensive construction capabilities and a sector leading ability to deliver sustainable solutions.  The Group had annual revenue in 2016 of some £5.2 billion, employs around 48,500 people and operates across the UK, in the Middle East and Canada.

The Group has four business segments:

Support services - this includes facilities management, facilities services, energy services, utilities services, road maintenance, rail services, remote site accommodation services and consultancy services in the UK, Canada and the Middle East.

Public Private Partnership (PPP) projects - this includes investing activities in PPP projects for Government buildings and infrastructure mainly in the Defence, Health, Education, Transport and Secure accommodation sectors in the UK and Canada.

Middle East construction services - this includes building and civil engineering activities in the Middle East.

Construction services (excluding the Middle East) - this includes building, civil engineering and developments activities in the UK and construction activities in Canada.

This and other Carillion news releases can be found at www.carillionplc.com.

Cautionary statement

This announcement may contain indications of likely future developments and other forward-looking statements that are subject to risk factors associated with, among other things, the economic and business circumstances occurring from time to time in the countries, sectors and business segments in which the Group operates. These and other factors could adversely affect the Group's results, strategy and prospects. Forward-looking statements involve risks, uncertainties and assumptions. They relate to events and/or depend on circumstances in the future which could cause actual results and outcomes to differ materially from those currently anticipated. No obligation is assumed to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Key financial figures

				2016	2015	Change
	Income statement
	Total revenue		£m	5,214.2	4,586.9	+14%
	Underlying operating profit(1)		£m	253.9	244.4	+4%
	Underlying profit from operations		£m	235.9	234.4	+1%
	Total Group underlying operating margin		Percentage	4.9	5.3	n/a
	Support services underlying operating margin		Percentage	6.7	5.8	n/a
	Middle East construction services underlying operating margin		Percentage	2.4	4.2	n/a
	Construction services (excluding the Middle East) underlying operating margin		Percentage	2.7	3.0	n/a
	Underlying profit before taxation		£m	178.0	176.5	+1%
	Profit before taxation		£m	146.7	155.1	-5%
	Underlying earnings per share		Pence	35.3	35.0	+1%
	Basic earnings per share		Pence	28.9	30.9	-6%
	Diluted earnings per share		Pence	25.9	28.2	-8%
	Dividends
	Proposed full-year dividend per share		Pence	18.45	18.25	+1%
	Underlying proposed dividend cover(1)		Times	1.9	1.9	n/a
	Basic proposed dividend cover		Times	1.6	1.7	n/a
	Cash flow statement
	Underlying cash flow from operations(1)		£m	277.1	244.9	+13%
	Underlying profit from operations cash conversion		Percentage	117	104	n/a
	Pension deficit contributions		£m	(46.6)	(47.4)	+2%
	Balance sheet
	Net borrowing		£m	(218.9)	(169.8)	-29%
	Committed borrowing facilities maturing between 2017 and 2020		£m	870.0	870.0	-
	Private placement borrowings maturing between 2017 and 2024 (£135 million and US$ 280 million)		£m	(360.8)	(325.5)	-11%
	Convertible bonds maturing by 2019		£m	(170.0)	(170.0)	-
	Net retirement benefit liability (net of taxation)		£m	(663.2)	(317.6)	-109%
	Net assets		£m	729.9	1,016.6	-28%
(1)		Alternative Performance Measures are defined in note 15 on pages 40 to 45.

Click on, or paste the following link into your web browser, to view the associated PDF document.

http://www.rns-pdf.londonstockexchange.com/rns/1423Y_-2017-3-1.pdf

 

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