Morgan Sindall - the building company with interests ranging from affordable housing to the Channel Tunnel rail link - yesterday posted a sharp rise in half-year profits.
The company, parent of Tamworth-based housing firm Lovall, said it had "never been better placed" after pre-tax profits jumped by 39 per cent to £18.2 million and its order book rose to a record £2.9 billion.
Turnover climbed from £604 million to £615 million, while earnings per share jumped by 36 per cent, from 21.89p to 29.72p. The interim dividend payment rises 33 per cent, from 5.25p to 7p.
The increase in profitability was mainly due to the performance of its divisions involved in fit outs and refurbishments and affordable housing, which operate from nine regional offices under the Lovell brand.
Infrastructure services performed in line with expectations, although Morgan, which employs around 5,000 people, repeated a warning that revenues and profits would be lower this year as two large civil engineering projects draw to a close.
They involved work on the creation of the Channel Tunnel rail link and a £150 million contract for various tunnels at Heathrow Terminal Five.
That work is being replaced by projects in the utilities sector, including a £450 million contract with United Utilities for the renewal and maintenance of water and electricity networks over the next five years.
In the half-year, the infrastructure arm posted operating profits of £2.8 million, slightly down on the last year after revenues slipped to £ 118 million from £177 million a year earlier.
Morgan - formed in 1994 from the reverse takeover by William Sindall of Morgan Lovell - described the affordable housing sector as "fast growing" and said significantly better margins of 4.3 per cent helped profits up by 36 per cent to £7.7 million.
Profits in the fit-out division improved by 41 per cent to £7.9 million as Morgan said it benefited from the opening of a northern office and the withdrawal of a number of competitors last year.
Chief executive Paul Smith said Morgan was well placed for the year ahead. He added: "As we reported in June we are confident of meeting our expectations for the current year and are excited by the challenges and opportunities for 2006 and beyond."
Lovell, which has its Midlands regional office at the Woodgate Business Park, Halesowen, and its head office at Marston Park, Tamworth, made a strong contribution to Morgan Sindall's overall performance, with a forward order book worth a record £1.4 billion.
Key projects for the Midlands include a £17 million regeneration scheme at the Pitts Farm Estate, Erdington, in partnership with Waterloo Housing Association and Birmingham City Council.
Lovell will start work in early 2006 on the scheme to build 25 new houses for shared ownership and affordable rent, ten new council bungalows for elderly residents and 65 houses and flats for sale on the open market, as well as refurbishing up to 82 council properties. Other projects in Birmingham include the £22 million 280-home mixed tenure Central Park development at Hockley, Birmingham, in partnership with Bromford Housing Group.