Table of Contents
Kier Group will buy back £20m from investors as the infrastructure group continues to cash in on major public spending initiatives and slash its debts.
The FTSE 250 infrastructure group told shareholders on Tuesday that it expects to report a net cash position by 2024, having reduced its average net debt at the end of the month to £38m from almost £137m last year.
Kier resumed dividends last year as strong cash generation helped deleverage the group’s balance sheet and free up cash to return to investors.
The group, whose order book rose 2 per cent last year to £11bn, said it was “well positioned to benefit from the UK government’s and regulated industry’s infrastructure spending plans”.
The Prime Minister and Chancellor have promised a spending spree on Britain’s crumbling infrastructure and housing shortage.
Kier Group shares rose 5.1 per cent to 145.4 pence in early trading, taking one-year gains to 12.9 per cent.
Keir boosts Kier: Prime Minister and Chancellor have promised a spending spree for Britain’s crumbling infrastructure and housing shortage
It is another solid update after Kier told shareholders in November it had made a good start to the trading year.
Kier said on Tuesday that it “continued to trade well” in the months since its last update, with results in line with expectations and performance likely weighted into the second half of the year.
Analysts have previously singled out Kier as a major beneficiary of Labour’s policies, with its water infrastructure and well-placed property arms.
Kier highlighted a £240 million contract recently secured from the Ministry of Defense to design and build new accommodation at Keogh Barracks in Surrey, as well as its work to support a £500 million plan to reduce the carbon footprint of the NHS estate.
Its infrastructure businesses are working with Yorkshire Water to support the company’s £850 million investment in water and waste processing networks.
Kier said: ‘We continue to believe that, as a strategic supplier of key areas of the new Government’s priorities, including transport, education, healthcare, justice, defense and nuclear energy, there are significant medium-term growth opportunities. for the group.
“In addition to this, we should also benefit from the significant investment plans being announced in regulated industries, particularly in water.”
Chief Andrew Davies added: “The strength of our cash generation, combined with the multi-year revenue visibility offered by our growing quality order book and supported by our strong balance sheet, gives us confidence that this momentum will continue. “.
“Given the growth in our order book combined with our continued deleveraging and increased confidence that we will achieve an average net cash position at the end of the month, we have today announced a £20 million share buyback, as part of our evolved policy of capital allocation to maximize shareholder participation returns.”
DIY INVESTMENT PLATFORMS

AJ Bell

AJ Bell
Easy investing and ready-to-use portfolios

Hargreaves Lansdown

Hargreaves Lansdown
Free Fund Trading and Investment Ideas

interactive inverter

interactive inverter
Fixed fee investing from £4.99 per month

sax

sax
Get £200 back in trading fees

Trade 212

Trade 212
Free trading and no account commission
Affiliate links: If you purchase a This is Money product you may earn a commission. These offers are chosen by our editorial team as we think they are worth highlighting. This does not affect our editorial independence.