TIDMKLR
RNS Number : 8821Q
Keller Group PLC
23 October 2023
23 October 2023
Keller Group plc
Trading Update
On track for a record year; full year operating profit to be
materially ahead of market expectations
Keller Group plc ('Keller' or 'the Group'), the world's largest
geotechnical specialist contractor, issues a trading update for the
period ended 30 September 2023.
Overall, positive trading momentum in the third quarter has been
maintained following the Group's exceptionally strong first half
performance. Given our trading performance to date and the
continued momentum in the business, we now expect full year
underlying operating profit to be materially ahead of current
market expectations.
In North America, more resilient pricing than expected in
Suncoast and sustained operational improvements in the foundations
business have resulted in a strong performance, with a more
progressive recovery in the operating margin than expected. The
pricing benefit at Suncoast is expected to moderate into 2024 with
the margin returning to more normalised levels.
In Europe, the macro-economic environment remains a challenge
for the business, resulting in weak demand in the residential and
commercial sectors across the region. Profitability continues to be
impacted by the competitive pricing environment and the impact of
some challenging projects, whilst the effect of several large
successful projects in the prior year, provides a tough comparator
for the period. Accordingly, the anticipated profitability
improvement in the second half will be less than expected and as a
result we are taking appropriate corrective actions.
In Asia-Pacific, Middle East and Africa (AMEA), Keller Australia
is performing strongly, particularly in the infrastructure sector,
and Austral has returned to profit in the third quarter as
expected. At NEOM, we remain in discussions with the client in
respect of the award of future works orders, however, due to the
evolution of the design, the piling work on The Line has been
delayed and we are taking steps to redeploy resources in the short
term.
Reflecting the very strong earnings performance, together with
continued focus on working capital management, the Group's cash
generation for the year to date is considerably ahead of the prior
year and better than our expectations. We therefore expect the
year-end net debt/EBITDA leverage ratio to be below 1.0x, well
within our target range of 0.5x - 1.5x (2022: 1.2x).
Commenting, Michael Speakman, CEO of Keller Group plc, said:
"The Keller team has built on an exceptionally strong first half
to deliver a better than expected third-quarter performance, and
consequently we now expect full year underlying profit to be
materially ahead of current market expectations. This performance
reflects continued momentum and operational improvements within the
business and the outstanding contribution of colleagues across the
Group, whom I would like to thank for their dedication and hard
work".
The Group will announce its full year results for 2023 on 5
March 2024.
For further information, please contact:
Keller Group plc www.keller.com
Michael Speakman, Chief Executive
Officer 020 7616 7575
David Burke, Chief Financial Officer
Caroline Crampton, Head of Investor
Relations
FTI Consulting
Nick Hasell 020 3727 1340
Matthew O'Keeffe
Notes to editors:
Keller is the world's largest geotechnical specialist contractor
providing a wide portfolio of advanced foundation and ground
improvement techniques used across the entire construction sector.
With around 10,000 staff and operations across five continents,
Keller tackles an unrivalled 6,000 projects every year, generating
annual revenue of cGBP3bn.
Cautionary statements:
This document contains certain 'forward-looking statements' with
respect to Keller's financial condition, results of operations and
business and certain of Keller's plans and objectives with respect
to these items.
Forward-looking statements are sometimes, but not always,
identified by their use of a date in the future or such words as
'anticipates', 'aims', 'due', 'could', 'may', 'should', 'expects',
'believes', 'intends', 'plans', 'potential', 'reasonably possible',
'targets', 'goal' or 'estimates'. By their very nature forward
looking statements are inherently unpredictable, speculative and
involve risk and uncertainty because they relate to events and
depend on circumstances that will occur in the future. There are a
number of factors that could cause actual results and developments
to differ materially from those expressed or implied by these
forward-looking statements. These factors include, but are not
limited to, changes in the economies and markets in which the Group
operates; changes in the regulatory and competition frameworks in
which the Group operates; the impact of legal or other proceedings
against or which affect the Group; and changes in interest and
exchange rates. For a more detailed description of these risks,
uncertainties and other factors, please see the Principal risks and
uncertainties section of the Strategic report in the Annual Report
and Accounts. All written or verbal forward looking-statements,
made in this document or made subsequently, which are attributable
to Keller or any other member of the Group or persons acting on
their behalf are expressly qualified in their entirety by the
factors referred to above. Keller does not intend to update these
forward-looking statements. Nothing in this document should be
regarded as a profits forecast. This document is not an offer to
sell, exchange or transfer any securities of Keller Group plc or
any of its subsidiaries and is not soliciting an offer to purchase,
exchange or transfer such securities in any jurisdiction.
Securities may not be offered, sold or transferred in the United
States absent registration or an applicable exemption from the
registration requirements of the US Securities Act of 1933 (as
amended).
LEI number: 549300QO4MBL43UHSN10 Classification: 3.1 Additional
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Keller (LSE:KLR)
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