Interim Management Statement (3)
5 November 2013
Costain, one of the UK's leading engineering solutions providers, today issues its Interim Management Statement covering the period from 1 July 2013 to the current date.
Following its strong performance in the first half of 2013, the Group is continuing to perform well, in line with the Board's expectations.
The integration of EPC Offshore, acquired on 1 August 2013, is progressing well and on schedule.
Costain is reinforcing and building on its position as a provider of integrated consulting, project delivery and operations and maintenance services to meet the integrated service requirements of major blue chip customers. These customers are increasingly working only with suppliers who can deliver a full range of services across the life cycle of a project, ahead of time and on budget, as well as sharing their corporate and social values.
Costain’s 'Engineering Tomorrow' strategy, a commitment to generating and delivering innovative, value-driven solutions to meet major national needs, is enabling the Group to continue to win new contracts and extensions.
Examples of work won this year to date include:
A landmark AMP6 programme for Thames Water
A number of contracts for Crossrail including the design, fit-out and commissioning of the railway systems
A contract with EDF to design and deliver the water cooling systems for the Hinkley Point C new nuclear power station
The Group’s forward order book has increased further since the half-year, and currently stands at a new record level of £3.0 billion.
As well as including over £700 million of revenues secured for 2014, the order book also provides good long-term visibility with circa £2.1 billion of revenues secured for 2015 and beyond, the balance of the order book being for the remainder of 2013. Over 90% of the order book is a target cost, cost reimbursable form of contract.
The Group has a strong preferred bidder position of over £400 million.
The overall level of tendering activity across the Group's targeted markets remains high.
Alex Vaughan has been appointed Managing Director of the Natural Resources division, succeeding Mark Rogerson who has left the Group to pursue other opportunities. Tim Bowen has replaced Alex Vaughan as Corporate Development Director.
The Group continues to benefit from a robust financial position with a net cash position.
In its half-year results announcement the Group highlighted that net cash would trend lower as the Group benefits from its increased emphasis on support service related activities and on customers who increasingly utilise a target cost based form of contract, together with changing industry cash flow profiles.
Costain is on course to deliver a result for the current year in line with the Board's expectations and, with a record order book and high levels of tendering activity across all of its markets, the Group is well positioned to deliver further progress.
5 November 2013
Costain Tel: 01628 842 444
Andrew Wyllie, Chief Executive
Tony Bickerstaff, Finance Director
Graham Read, Communications Director
College Hill Tel: 020 7457 2020