Aug 5 British construction company Morgan
Sindall Group Plc said first-half profit fell 95
percent as increased competition hurt margins.
The company said that an exceptional charge of 13 million
pounds ($19.85 million) taken as a provision against amounts
recoverable on a small number of older construction contracts
also hurt profit.
Morgan Sindall, which builds houses, refurbishes offices and
undertakes redevelopment projects, said it did not expect
overall market conditions to improve significantly in the second
half of 2013.
Profit before tax fell to 1 million pounds in the six months
ended June 30 from 18.8 million pounds a year earlier. Revenue
rose 2 percent to 1.02 billion pounds.
Adjusted gross margin fell 120 basis points to 8.1 percent.
Morgan Sindall, which gets roughly half its revenue from
government contracts, had reported an 8 percent decline in 2012
revenue, hurt by government spending cuts.
The company, which got 70 percent of its work in the
construction business from the public sector about four years
ago, has been reducing its exposure to the public sector as it
copes with government budget cuts.
Morgan Sindall's order book was flat at 3.1 billion pounds.
Shares in the company were down 4.7 percent at 627.5 pence
in thin trading on Monday morning on the London Stock Exchange.