Keller's global push wins record interim profits

Keller, the ground engineering specialist, continues to push hard to establish a position as a major global player, and latest financial results show the success of this strategy: operating profit from overseas operations contribute £57m of Keller’s total operating profit of £59m.

Keller’s interim financial results, covering the six-months to 30 June 2008, contain segmental analysis showing operating profit contributions of:

• £24m – CEMA, the area made up of operations in Continental Europe, Middle East and Asia
• £22m – North America
• £11m – Australia
• £2m – UK

The ranking of the above figures shows a substantial change from the first half of the previous period when North America led the way with an operating profit of £29m and Australia contributed just £5m.

Keller’s group interim turnover climbed to £570m (figure in first half of 2007: £440m) while pre-tax profit ran to £54m (figure in comparable period of previous year: £45m).

Justin Atkinson, chief executive, said: “The trend of increased geographic diversification has continued, particularly into the fastest-growing parts of the group in the Middle East, Eastern Europe and Australia. As a result we are now more broadly based than ever.

“We go into the second half of 2008 with a strong orderbook. The results for the year as a whole will be broadly in line with last year’s.”

Over 60% of group profit is now derived from markets outside the US, compared with less than 30% three years ago.

Cash generated from operations increased to £43m compared with last year’s £40m.

Net debt ended the period at £74m, a rise of £20m, but in the six-month period Keller spent £28m on acquisitions and another £55m on modernising and expanding the equipment fleet.

Keller’s operational overview contains the following items:

• US
  Overall, the US non-residential construction market remains resilient, driven by strong demand from the power and industrial sectors and year-on-year growth in infrastructure spending.
• CEMA [Continental Europe, Middle East and Asia]
  Excellent first half. Turnover jumped from £140m to £200m while operating profit was up by 70% to £24m.
• Australia
  A large proportion of the Australian construction market continues to be extremely strong, particularly the public infrastructure and commodities-related sectors.
• UK
  Overall, the market remained quite resilient with the exception of the housing sector where Keller has historically won 30% of its turnover – and here the group sees no improvement in the short term.