Last weeks trading statement from this support/construction business proved what a strong position the company is in.

looks to be plenty of growth going forward.......

RNS Number : 8437J
Carillion PLC
10 December 2008



10 DECEMBER 2008




PRE-CLOSE UPDATE ON TRADING IN 2008

UNDERLYING EARNINGS PER SHARE TO GROW BY 15% SUPPORTED BY ROBUST BALANCE SHEET







Leading UK support services company, Carillon plc, is providing this pre-close update on trading in 2008, ahead of announcing its preliminary results on 4 March 2009.




Highlights




Continuing strong performance supported by a reduction in the Group's underlying effective tax rate to around 20% - underlying earnings per share(1) for the 12 months to 31 December 2008 expected to grow by approximately 15%, some 5% ahead of previous expectations.

Alfred McAlpine successfully integrated with integration and re-organisation cost savings increased by 10 million to a run rate of 50 million per annum by the end of 2009.

Balance sheet remains robust - cash flow remains strong with net borrowing expected to be below 275 million at the year end.

Expect strong revenue growth in support services at margins in excess of the 4.1% achieved in 2007.

Public Private Partnership projects creating significant value - 6 investments sold for 59.7 million in 2008.

Middle East business expected to deliver strong growth with an increasing contribution from projects in Abu Dhabi - margins expected to be at least 6%.

Satisfactory performance in construction services (excluding the Middle East) - operating margin expected to be in excess of the 1% achieved in 2007.

Underlying effective tax rate expected to reduce from 25% to around 20% in 2008 and to remain at this level for the foreseeable future.

.

Business performance




Our results are expected to reflect the strong progress the Group has made in 2008, enhanced by the acquisition of Alfred McAlpine in February 2008. This acquisition created the UK's largest support services business and further increased the Group's resilience, in line with our strategy for growth.




Support services




Support services continues to be a major driver of earnings growth and continues to account for over half the Group's underlying operating profit (1) . Revenue is expected to increase substantially in 2008, primarily reflecting the acquisition of Alfred McAlpine. The operating margin is also expected to increase, within our target range of four to five per cent, largely due to the effect of integration cost savings.










(1) Continuing operations before intangible amortisation, impairment, restructuring costs and non-operating items.










New order intake has remained strong and we continue to have our largest ever pipeline of opportunities for new contracts.




Public Private Partnership (PPP) projects




Our investments in PPP projects continue to generate substantial value. During the year a further six investments in mature projects were sold, generating total cash proceeds of 59.7 million. As indicated in our 2008 Interim Report, this reflected a net present value for the cash flows from these investments based on an average underlying discount rate of under 5.5 per cent. Carillion has now sold a total of 23 mature investments in PPP projects over the last five years, generating cash proceeds of 179 million and a pre-tax profit of 104 million.




We expect to continue to make good progress in this segment. During 2008, we achieved financial close or preferred bidder positions on four further projects in which we expect to invest 11.2 million of equity. In addition, we have a healthy pipeline of potential new projects, including eight projects for which we are currently shortlisted.




Middle East construction services




In Middle East construction services, we expect to report further strong growth in 2008, driven by increased activity levels in Dubai and Oman, together with contributions from Abu Dhabi and Cairo, where we began operations at the beginning of the year. Going forward, we expect growth to be increasingly driven by Abu Dhabi, where we negotiated substantial new work in 2008 worth over 1 billion and also increased our pipeline of potential opportunities.




We therefore continue to expect long-term sustainable growth in this region and remain confident that we will achieve our objective of broadly doubling revenue in this segment from the 2007 level of 337 million to a run rate of over 600 million by the end of 2009, at an operating margin of some six per cent.




Construction services (excluding the Middle East)




In this segment, we remain focused on project selectivity, in line with our objective of increasing margins rather than revenue, in order to improve the combined operating margin for all our construction activities, including the Middle East, towards three per cent over the next three years. This strategy is supported by our substantial, high-quality order book and probable new orders, which provide sufficient visibility for us to be confident of achieving our expectations for 2009.




Following the acquisition in October 2008 of the Vanbots Group, a well established construction management services group in Canada, the integration of this business is progressing to plan. This acquisition has significantly enhanced our ability to provide fully integrated solutions, especially for PPP projects, further strengthening our market leadership in Canada, particularly in the health sector.




Balance sheet




The Group continues to deliver strong cash flow and net borrowing at the year end is expected to be below 275 million and below our target of 300 million.




Taxation




Carillion has been successful in agreeing with the tax authorities certain prior year tax issues and a mechanism for the use in 2008 and beyond of certain tax losses acquired with Alfred McAlpine. Consequently, the Group's effective tax rate is expected to reduce from 25 per cent in 2007 to around 20 per cent in 2008. The Group's ability to maintain its effective tax rate at this level for the foreseeable future will be further underpinned by the UK Government's proposal to exempt UK companies from taxation on foreign earnings from April 2009, announced in its 2008 Pre-Budget Report on 24 November 2008.



Acquisition and integration of Alfred McAlpine




The benefits of acquiring and successfully integrating Alfred McAlpine continue to exceed our expectations. Integration and reorganisation cost savings are now expected to reach an annual run rate of 50 million by the end of 2009, an increase of 10 million on the previously announced run rate of 40 million. Additional cost savings have been identified across most areas of our enlarged business as integration has progressed, notably through the adoption of Carillion's shared central services and the outsourcing and off-shoring of back-office processes. All savings have either been delivered, or firmly secured for delivery, with absolute savings expected to be 15 million in 2008, 35 million in 2009 and 50 million in 2010, an increase of 5 million in 2009 and 10 million in 2010. The one-off cost of delivering these savings will increase from the previously announced figure of 40 million to 55 million.










Outlook




The wider economic background will undoubtedly become increasingly difficult and make delivery of our business objectives more challenging. However, Carillion is a well-balanced and resilient business, with strong positions in its chosen market sectors in the UK, the Middle East and Canada. Therefore, with a robust balance sheet, a strong order book and continuing opportunities in our main market sectors, Carillion continues to expect to build on its strong performance in 2008 and deliver materially enhanced earnings in 2009.




Carillion Chief Executive, John McDonough and Group Finance Director, Richard Adam, will host a conference call on this statement for analysts and investors at 9:00am today, Wednesday 10 December. The telephone number to join the conference call is + 44 (0) 207 190 1232.




For further information contact:




Richard Adam, Group Finance Director + 44 (0) 1902 422431

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Interim Results

· Financial performance in line with expectations

- First-half revenue reduced, primarily due to the continued re-scaling of UK construction and the timing of project awards in the Middle East
- Strong growth in underlying profit from operations reflects a continuing improvement in operating margin
- Underlying profit before taxation and underlying earnings per share increased, despite a higher net financial expense
- Substantial increases in reported profit before taxation and basic earnings per share, included a contribution from the sale of equity investments in Public Private Partnership projects

· Strong balance sheet

- Net borrowing better than expected
- Over £800m of long-term borrowing facilities

· Good revenue visibility: strong order book plus probable orders; record pipeline of opportunities

- 92% revenue visibility(5) for 2012
- £2.2bn of new and probable orders won in the first half, with total orders and probable orders worth £18.3bn at 30 June 2012 (31 December 2011: £19.1bn)
- Record pipeline of contract opportunities of £35.6bn (31 December 2011: £33.1bn), including major UK public sector outsourcing opportunities, supports targets for growth

· Interim dividend increased by 2% to 5.4p (2011: 5.3p)

Interim Management Statement

"PERFORMANCE IN LINE WITH PREVIOUS GUIDANCE"

Following the Group's first-half eight per cent increase in operating profit, we continue to expect to deliver improvements in operating profit and total operating margin in the full year. We also continue to expect full-year revenue to be lower than in 2011, primarily due to the planned re-scaling of our UK construction activities to align these activities with the shrinking UK market. The expected increase in the Group's net financial expense in 2012, due largely to a higher interest charge relating to pensions, remains unchanged from the guidance we gave when we announced our half-year results.

The performance of, and outlook for, our four business segments, namely support services, Public Private Partnership projects, Middle East construction services and construction services (excluding the Middle East), remains in line with those we announced at the half year.

Our pipeline of contract opportunities remains strong and since the half year we have continued to win new orders and probable orders, notably in the Middle East where our businesses have won new and probable orders with a total value to Carillion of some £185 million. The largest of these orders is a £113 million contract to build a mixed use development for the Oman Public Authority for Social Insurance, on which work has already commenced.

During the third quarter, we completed the sale of further equity investments in Public Private Partnership projects, generating cash proceeds of £15.4 million.

Year-end net debt is expected to be around the same level as it was at the half year, namely £115 million, in line with previous guidance.

Outlook

In addition to remaining on track to deliver full-year results in 2012 in line with expectations, we also remain well positioned to achieve our medium-term targets, namely to deliver growth in support services and to double our annual revenues in the Middle East and in Canada in the five year period to 2015, in each case to around £1 billion.

Improved prospects for the uk construction and encouraging order book in the Middle East could prompta re-rating.
Carrillion has just won a £600m contract withy Birmingham city council to improve the energy effciency of 60,000 homes and offices,and the deal could be extended throughout the West Midlands, boosting its value to £1.5bn. And news is expected soon on the Royal Liverpool hospital project for which carrillion has been shortlisted-
this could be worth another £750m. Yet even before these the order book looked healthy. It stood at £18.3bn at the end of June when Carillion also had a record £35.6bn- worth of contracts in its bidding pipeline.
But it gets better. Earlier this month , the government announced new guidelines for PFI schemes, a string of projects that were on hold will now be released. Chief executive Richard Howson believes there could be £2.5 bn of priority schoolswork up for grabs in the first quarter of next year and thats just for starters.

Trading on forward PE ratio of just seven and offers a prospective yield of nearly 6%, while the order book stands at over £18bn in addition to a record £35bn- worth of contracts in its bidding pipeline. Going to take a while before the momentum builds but required spending on infrustructure does not go away, its simply being piled up.

Carillion: Investec reduces target price from 380p to 350p and reiterates a buy rating.

Pre-close Trading Update

Carillion expects to deliver a robust financial performance in 2012, with growth in operating profit despite market conditions remaining challenging. As guided, revenue will be lower than in 2011, due principally to the planned re-scaling of UK construction, but the Group's total operating margin is expected to increase as the overall quality of our business continues to improve.

Underlying earnings per share are expected to be broadly in line with market expectations. From 2012, profit from selling equity investments in Public Private Partnership (PPP) projects will be treated as part of underlying operating profit, (previously treated as non-operating); although this is not expected to have a material effect on underlying earnings per share, it is expected to move underlying earnings per share slightly ahead of the market consensus forecast for 2012.

Reported profit before tax and earnings per share are expected to increase substantially.

Carillion acquires 49 per cent interest in Canadian support services business for some £24 million

Integrated support services company, Carillion plc, has acquired a 49 per cent interest in The Bouchier Group for a consideration of £23.75 million. The consideration will be paid in cash in phased installments over the period to January 2014, with instalments adjusted to ensure the acquisition is completed on a debt free, cash free basis.

Carillion HM contract in Canada £525m

Carillion Canada has been selected for long-term contracts to provide year-round routine maintenance services for Provincial Highways in Ontario and Alberta, worth some £525 million.

Looks good.

Carillion strategic partner by Lancashire CC £150m

Carillion has been selected by Lancashire County Council as the preferred bidder to become a strategic partner for the delivery of a range of property services for East and North Lancashire.

This innovative contract will initially focus on property development, which is expected to be worth up to £150 million over 10 years, but this has the potential to increase as the scope of the services to be provided by Carillion can be extended under the terms of the contract.

The contracts are all lined up, as said in an earlier post they must come in some time.
:-))

Carillion secures 525m pounds of highway contracts in Canada
Wed 12 Dec 2012

CLLN - Carillion

Latest Prices
Name Price %
Carillion 298.60p +0.91%

FTSE 250 12,188 -0.02%
FTSE 350 3,165 +0.05%
FTSE All-Share 3,099 +0.06%
Support Services 5,218 -0.14%

LONDON (SHARECAST) - FTSE 250-listed support services company Carillion has been selected for a series of highways maintenance contracts in Canada that are collectively worth 525m pounds.

Carillion Canada, the Canadian arm of the global company, was selected for long-term contracts to provide year-round routine maintenance services for Provincial Highways in Ontario and Alberta.

In Ontario, the Ministry of Transportation Ontario has awarded Carillion the area maintenance contracts for Kingston West and Bancroft, worth approximately £120m over 12 years and selected Carillion as the preferred bidder for the Thunder Bay Area Maintenance Contract, worth £105m over 11 years.

The Alberta Ministry of Transportation selected Carillion as the preferred bidder for five Contract Maintenance Areas worth some £300m over 10 years. Of the total value of £525m, some £475m relates to contract renewals.

Commenting, Carillion Group Chief Executive, Richard Howson, said: "This further reinforces Carillion's position as the largest provider of outsourced highways maintenance services in Canada and reflects our ability to provide high-quality cost-effective solutions for our customers, with whom we have developed strong long-term partnerships."

Carrillion has a market capitalisation of £1,285.99m and operates across the UK, Canada and the Middle East.

Its share price rose 0.71% to 298p at 08:25 on Wednesday morning.

The chart is looking good for a further rise.

Carillion: Credit Suisse ups target price from 316p to 349p and downgrades to neutral.

Carillion: Berenberg upgrades from hold to buy.

Final results on Wed 27 Feb

Wednesday's agenda: Carillion looks to the Middle East
6:30 pm by John Harrington





Carillion (LON:CLLN), according to Panmure Gordon, is definitely a stock that divides opinion so Wednesday's full year results could see the dividing lines redrawn.

The market consensus is for profit before tax of £207.8mln on turnover of £4.38bn. The range for profit before tax runs from £169mln to £220mln.

Panmure Gordon is in the camp that is positive on the stock, but it acknowledges that "cautious peer group comments on UK construction have had a negative impact while uncertainty persists on its international strategy."

On the plus side, the group has a "strong support services offering including energy services, and improving quality of earnings."

For Panmure Gordon the key issues will be: UK construction activity, which Carillion's peers suggest has become more challenging; international opportunities, particularly in the Middle East and Canada; the energy services outlook post feed-in tariffs issues and the energy bill.

Peel Hunt, meanwhile, says the focus is likely to be on the pace of UK construction margin erosion, and the potential offset from Middle East recovery.

"Working capital outflows are likely to lead to further leverage and we look for year end net debt of £138.7m (average 2012 net debt c£320m). Pension liabilities (IAS 19 £248m) will likely lead to ongoing (£40m) cash top-ups," Peel Hunt reckons.

RNS Number : 7413Y

Carillion PLC

27 February 2013






27 February 2013



Carillion preferred bidder for £210 million of new work in the Middle East

Total new orders and probable orders for the Group of £650 million



Carillion has made a good start to 2013, winning new orders and probable orders in the first seven weeks of the year that are expected to be worth some £650 million.



In the Middle East we have secured probable orders worth approximately £210 million for projects in Oman, Abu Dhabi and Saudi Arabia, where we expect to begin delivering our first major project during 2013.



In support services, we have won orders and probable orders worth some £280 million. This includes facilities management contracts in the UK and Canada, a further highways maintenance contract in Canada and Energy Company Obligation (ECO) contracts in the UK. These ECO contracts are initially worth some £75 million, but have significant potential for growth.



In construction services (excluding the Middle East), we have secured new and probable orders worth approximately £160 million, for long-term public and private sector customers.



In line with our policy of selling equity in mature Public Private Partnership (PPP) projects, we have sold our investment in the Permanent Joint Headquarters, Northwood project. This sale generated cash proceeds of £29.4 million, which represented a discount rate in line with the average seven per cent, at which we have been consistently selling PPP equity investments.



Commenting, Carillion Chief Executive, Richard Howson, said: ''Although markets remain challenging, we have made a good start to the year in terms of new orders and probable orders and I am particularly pleased with our progress in the Middle East and in the ECO market. We have also remained selective in terms of the contracts for which we bid in order to support margins, by focusing on contracts where we can use the breadth of our skills and the scale of our resources to differentiate our offering.



The secondary market for PPP equity remains strong and continues to support our policy of selling investments in mature projects and reinvesting the proceeds in new projects".

Preliminary Results

· Robust financial performance
- Revenue reduced as previously guided, primarily due to the planned rescaling of UK construction
- Underlying profit from operations(2) increased, reflecting an improvement in total operating margin
- Reported profit before taxation and basic earnings per share both increased substantially, due to minimal non-recurring and non-operating items
- Underlying profit before taxation(2) and underlying earnings per share(2) reduced slightly, due to a higher net financial expense, including an increase in the non-cash interest charge relating to pensions

· Strong balance sheet
- Net borrowing of £155.8 million (2011: £50.7 million) reflects the expected outflow of working capital, primarily due to the rescaling of UK construction, and the acquisition of the Bouchier Group in Canada
- Over £1 billion of committed borrowing facilities and private placement funding

· Strong order book and record pipeline of contract opportunities
- £5.2 billion of new and probable orders in 2012
- Total order book plus probable orders of £18.1 billion (2011: £19.1 billion), with the reduction on 2011 due primarily to the sale of equity investments in Public Private Partnership (PPP) projects and the rescaling of UK construction
- 75% revenue visibility(3) for 2013 (2011: 77% for 2012)
- Pipeline of contract opportunities worth some £35.2 billion (2011: £33.1 billion)

· Proposed full year dividend increased by 2% to 17.25p (2011: 16.9p)

(1)
Restated following the change in presentation of profits from the disposal of Public Private Partnership equity investments from non-operating items to operating items (amounting to £13.2 million in 2012 and £11.5 million in 2011).
(2)
The underlying results stated above are based on the definitions included in the key financial figures.
(3)
Based on expected revenue and secure and probable orders, which exclude variable work and re-bids.

Carillion (LSE: CLLN.L - news) : Canaccord Genuity downgrades to hold with a target price of 350p

Investec Hold 306.30 309.20 350.00 305.00 Downgrades