Pre-Close Trading Update - 5 January 2012
5 January 2012
Costain, one of the UK's leading engineering solutions providers, will announce preliminary results for the year ended 31 December 2011 on Wednesday 7 March 2012, and is issuing a trading update ahead of entering its Close Period.
Since the announcement of the Group's Interim Management Statement on 7 November 2011, Costain continues to perform well and consequently finished the year in line with the Board's expectations.
As a result of its strategy of focussing on major public and private sector customers whose spending plans are driven by national need, regulatory commitments or essential maintenance requirements, Costain secured significant new contracts during the year, including:
- London Bridge Station redevelopment for Network Rail;
- Crossrail Paddington Station and advanced works at Crossrail Bond Street;
- A465 Heads of the Valleys road for the Welsh Government;
- Contracts for Northumbrian Water AMP5 and Severn Trent;
- Energy Technologies Institute (ETI) development of carbon capture technology;
- Decommissioning contract at Trawsfynydd nuclear site.
The Group finished the year with an increased forward Order Book of £2.5 billion (2010: £2.4 billion), which included in excess of £650 million of work secured for 2012 and over £1.8 billion of revenue secured for 2013 and beyond.
In addition, Costain has a strong preferred bidder position at circa £400 million.
The Group made two acquisitions during the year. ClerkMaxwell, the front end engineering support services provider acquired in April, and Promanex, the industrial support services business acquired in August, both of which are performing well.
There has been no material change in the financial position of the Group, which has a strong cash position of in excess of £100 million and no significant borrowings.
Recently, the Group has further enhanced and extended its contract bonding and banking facilities with its relationship banks and surety companies. The facilities were increased by £30 million to £465 million and extended by two years to September 2015. These facilities ensure the Group has the necessary financial resources to capitalise on market opportunities as they arise and achieve its medium term objectives.
Andrew Wyllie, Chief Executive, commented:
“We have continued to benefit throughout this year from the implementation of our ‘Choosing Costain’ strategy, which has been to focus on blue chip customers in chosen sectors whose major spending plans are underpinned by strategic national needs, regulatory commitments or essential maintenance requirements.”