Interim Management Statement (5)
7 November 2011
Costain, one of the UK's leading engineering solutions providers, is today issuing its Interim Management Statement covering the period from 1 July 2011 to the current date.
Following the strong performance reported in the interim results announcement of 25 August 2011, the Group is continuing to perform well and trading is in line with the Board’s expectations.
Costain continues to benefit from its 'Choosing Costain' strategy of focussing on targeted blue chip customers in chosen sectors whose major spending plans are underpinned by strategic national needs, regulatory commitments or essential maintenance requirements. The implementation of this strategy, enhancing the breadth and scale of Costain’s service offering to encompass consulting and care as well as construction services, is transforming the Group into one of the UK's leading Tier One engineering solutions providers.
On 22 August 2011 Costain announced the acquisition of Promanex, an industrial support services business operating in the Power, Petrochemicals and Nuclear markets. The integration of this business is progressing well. The integration of Clerk Maxwell, the front-end engineering and operations support services provider operating in the upstream oil & gas sector and acquired earlier in the year, is complete.
Following further major new contract awards during the period, including the award by Network Rail of the London Bridge Station contract announced last week, the order book has increased to £2.6 billion.
As well as including in excess of £600 million revenue for 2012, the order book also provides good long-term visibility with over £1.8 billion of revenue secured for 2013 and beyond, the balance of the order book being for the remainder of 2011.
In addition, Costain continues to have a strong preferred bidder position, which has been maintained at circa £400 million.
There has been no material change in the financial status of the Group, which continues to have a strong cash position of in excess of £100 million and no significant borrowings.
Whilst challenging market conditions are set to continue for the foreseeable future, the Board expects to report results for the year in line with its expectations.