Kier to book £10m for turnaround programme

PA

Kier is to book £10 million of costs in its half-year related to the group’s turnaround programme, but has assured this is set to reverse over the full year.

The construction company said its “Future Proofing Kier” programme to streamline the business and improve cash generation is making good progress.

Implementing the programme in the first half of its financial year is expected to cost £10 million as initial expenses exceed realised savings.

For the full year, Kier expects earnings and cashflow to be neutral ahead of a £20 million benefit in 2019-20.

The programme will also see Kier dispose of around £30 million to £50 million worth of non-core assets.

Kier said on Thursday it will sell its stake in Australian road maintenance business KHSA to Downer Group, its joint venture partner, for up to 43.7 million Australian dollars (£24 million), with the proceeds to be used to reduce the company’s debt.

The group expects to meet full-year expectations, with the results weighted towards the second half of the financial year.

In September, Kier was buoyed a 9% jump in annual profits and a record-level order book following the collapse of rival Carillion earlier this year.