Kier cuts net debt by a further £100m

Kier has reduced its average monthly net debt by £100m through its ongoing deleverage strategy

The contracting giant, in a short trading update today, said its average month-end net debt for the six months to 31 December was £140m, down from £243m in the same period the previous year.

Andrew Davies, chief executive of the £3.3bn-turnover firm, said Kier had achieved this through “disciplined growth” as well as a focus on “operational excellence, cash management and cash generation”.

The latest reduction is part of an ongoing strategy which has already seen the firm cut its monthly net debt from £432m in 2021, helped by the sale of its housing business Kier Living.

Kier also said it has grown its order book by 6% to £10.7bn as of 31 December.

It has recently been awarded four education contracts worth a total of £150m, a £60m healthcare job, a £30m contract to deliver a pipeline in Northern Ireland and a £100m contract to deliver a new block at Elmley prison in Kent.

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In September it purchased the rail assets of stricken contractor Buckingham Group.

It said it has traded in line with expectations in the first half of its financial year in line with its expectation. As previously announced, it is planning to pay a dividend to shareholders when it publishes its interim results on 7 March.

Davies said: “Kier remains well positioned to continue benefiting from UK Government infrastructure spending commitments and this gives the Board every confidence in delivering our medium-term value creation plan.