Interim Management Statement (1)
5 November 2014
Costain, the engineering solutions provider, today issues its Interim Management Statement covering the period from 1 July 2014 to the current date.
The Group is today hosting a visit for investors and analysts to Paddington and Reading and later to its Maidenhead office. No new material information will be disclosed.
Following a strong performance in the first half of the year, Costain continues to perform well and in line with the Board's expectations.
The Group is benefiting from its unique and well-positioned strategy, focusing on major customers who are investing billions of pounds meeting national needs in energy, water and transportation, and who require solutions to their complex business challenges.
Costain’s reputation for developing and implementing innovative engineering led solutions through a range of integrated services and the benefits of the successful capital raise of £70.3 million (net of expenses) in March are enabling the Group to continue to take advantage of the opportunities created by its strategy and to continue to win significant contracts and extensions.
Additional work won during the period under review, demonstrating the range of skills and capabilities of the Group, include:
• Southern Water’s 2015 - 2020 (AMP6) investment programme;
• Two Smart Motorway Scheme contracts on the M1 for the Highways Agency;
• Upgrade of the Dimlington gas terminal for Perenco; and
• Appointment by BAE Systems, as announced separately today, as one of its framework contractors on the redevelopment of its submarine site, in Barrow-in-Furness, Cumbria.
The Group’s forward order book has increased further since the half-year, and currently stands at a new record level of £3.3 billion.
As well as including over £900 million of revenues secured for 2015 (2013: over £700 million secured for 2014), the order book also provides good long-term visibility with over £2.2 billion of revenues secured for 2016 and beyond.
In addition to the record order book, the Group has a strong preferred bidder position of over £400 million, and the level of tendering activity across all its target markets remains high.
The increasingly strategic nature of our long-term customer relationships has ensured that over 90% of the order book comprises repeat business and is in target cost, cost reimbursable, collaborative forms of contract providing increased visibility over long-term margins at lower risk.
The Group has a robust financial position with a strong net cash position in line with expectations.
The Group is on track to deliver a result for the current year in line with the Board's expectations and, with a record order book, strong cash position and high level of tendering activity, is well positioned to deliver growth over the medium term.
Costain Tel: 01628 842 444
Andrew Wyllie, Chief Executive
Tony Bickerstaff, Finance Director
Graham Read, Communications Director
Instinctif Partners Tel: 020 7457 2020