# Galliford Try Plc Delivered a strong financial and operational performance - Link: https://www.directorstalkinterviews.com/galliford-try-plc-delivered-a-strong-financial-and-operational-performance/412767071 - Published: 2019-02-13T07:48:42+00:00 - Author: Charlotte Edwards **Galliford Try Plc** (LON:GFRD), today announced half year report for the six months ended 31 December 2018 **STRONG FIRST HALF GROUP PERFORMANCE** | PRE-EXCEPTIONAL^(2) | | STATUTORY | | Financial | H1 2019 | H1 2018 | Change | | H1 2019 | H1 2018 | Change | | Revenue £m ^(1) | 1,418 | 1,495 | – 5% | | – | – | | | Group revenue £m ^(1, 9) | – | – | | | 1,344 | 1,403 | -4% | | Profit before tax £m ^(2, 3) | 84.2 | 81.3 | +4% | | 53.8 | 56.3 | -4% | | Earnings per share ^(2, 3, 4) | 62.4p | 72.7p | -14% | | 39.4p | 50.7p | -22% | | Dividend per share | – | – | | | 23p | 28p | -18% | | Net debt £m | – | – | | | 40.1 | 84.9 | +£44.8m | | Group RoNA ^(6, 5) | 23.5% | 24.7% | -1.2%pts | | 16.5% | 19.3% | -2.8%pts |   **Group** · Strong group underlying performance producing record pre-exceptional profit, with continuing progress against our strategic objectives across the Group. · 3,069 total new homes completed by Linden Homes and Partnerships & Regeneration( H1 2018: 2,878). · Net debt reduced to £40m (H1 2018: £85m), with average net debt decreasing to £126m (H1 2018: £203m). · Interim dividend of 23.0p declared (H1 2018: 28.0p), in line with 2.0x cover policy. · Increased total sales currently reserved, contracted and completed of £1,097m7( H1 2018: £1,008m) and a current Group order book of £5.4bn7 (H1 2018: £5.6bn). **Linden Homes** · Strong performance in more challenging markets, with operating margin continuing to grow. · Revenue of £392.1m (H1 2018: £436.8m) from 1,505 unit completions, 1,306 net of joint venture partners’ share (H1 2018: 1,587 and 1,346 respectively). · Private average selling price 5% lower at £352k (H1 2018: £370k), reflecting changed mix of sales in line with strategy. · Further improvement in operating margin to 19.6% (H1 2018: 18.5%). · 3,6077 unit sales currently reserved, contracted or completed representing a value of £850m7 (H1 2018: 3,401 units and £879m respectively). · First half year sales rate at 0.52 (H1 2018: 0.53) with a sales rate of 1.277, 10 from 1 January 2019 (H1 2018: 0.65 from 1 January 2018). · 11,7507 plot landbank (H1 2018: 11,540), in line with target of 3.5 years’ supply. **Partnerships & Regeneration** · Revenue up 27% to £284.9m (H1 2018: £223.5m), reflecting strong growth in both contracting and mixed-tenure. · Operating margin improving in line with our strategy to 5.1% (H1 2018: 4.8%). · Total sales currently reserved, contracted and completed up 91% at £247m7 of which £153m is for the current financial year to 30 June 2019 (H1 2018: £129m and £96m respectively). · Contracting order book of £1.2bn7 (H1 2018: £1.2bn). · 4,1007 plot landbank (H1 2018: 2,850). **Construction** · Aberdeen Western Peripheral Route (AWPR) construction completed. First half exceptional costs of £26m from completion delays. · Constructive dialogue with the client continues regarding significant and recognised claims. Financial statements include an estimate for these recoveries. · Lower revenues reflect more cautious bidding and project deferrals owing to clients’ macro uncertainty. · Pre-exceptional operating margin maintained at 0.9% (H1 2018: 0.9%) with encouraging performance on current projects. · Solid, high-quality order book of £3.2bn7 (H1 2018: £3.5bn). > **Peter Truscott, Chief Executive, commented:** > “Galliford Try has delivered a strong financial and operational performance in > the first half, with further progress against our 2021 strategy. The Group is > well capitalised and average net debt is below previous guidance, driven by focused > working capital management over the period. > We were delighted to achieve completion of the AWPR with final handover in progress, > successfully delivering a vital and major piece of infrastructure to the local > community. We continue constructive dialogue with our client regarding important > and recognised claims. > Linden Homes delivered a strong performance in the first half, despite the continuing > political uncertainty and its impact on confidence. The business continues to > pursue its successful strategy of product standardisation and improved process > efficiency, resulting in continued margin growth. We are seeing good demand, in > particular for smaller and mid-range family houses, supported by Help-to-Buy and > a strong mortgage market. We have seen a positive start to the Spring selling > season, despite the headwinds to consumer confidence arising from political uncertainty, > which is key to the strength of the market over the coming months. > Partnerships & Regeneration is performing very strongly, both at revenue and margin > levels. Opportunities for the business continue to grow, underpinned by our strong > relationships with providers and funders, our growing geographical footprint and > by cross-party political support for affordable housing. The business has been > encouraged by the successes it has seen in the first half of the year, with new > projects commenced across both contracting and mixed-tenure resulting in strong > levels of sales reserved, contracted or completed as well as a solid contracting > order book. > Construction’s performance continues to be encouraging, particularly on newer > contracts, reflecting the business’s careful approach to project selection and > risk management. We continue to prioritise the quality of each opportunity over > volume. We are seeing projects deferred as a result of macro uncertainty, but > with 96% of revenue secured for the current financial year and 66% secured for > the following year the business has confidence in its prospects. > The Group enters the second half of the year with a solid foundation, underpinned > by a strong balance sheet and our focus on high-quality earnings which will drive > further margin improvements over time. Our mix of residential development creates > a robust proposition in more uncertain markets. We remain cautious of the impact > of the current political uncertainty on consumer and business confidence, and > the medium-term outlook for the macro economy, but believe our focused strategic > objectives, strong order book and disciplined approach will deliver a full year > out-turn toward the upper end of the analysts’ current range8.” Share on: