Shares in Galliford Try jumped even after it reported losses for the second year in a row, as it predicted a return to profitability by 2021.
The construction firm was trading 11.3 per cent higher by 9.25am.
Galliford Try reported pre-exceptional revenue was down from £1.4bn to £1.1bn,while losses widened to £62.4m.
Building and infrastructure incurred pre-exceptional losses from operations of £51.9m and £1.8m respectively due to the impact of the pandemic and its associated delays, contract settlements and legal costs.
The pandemic reduced Galliford Try’s gross margin due to the impact of lower revenue, lower site productivity and the cost of implementing the new coronavirus operating procedures.
Why it’s interesting
Galliford Try was adversely affected by the pandemic as lockdown forced delays in its projects. But today the construction firm said all of its sites are operational with productivity at close to normal levels.
The group expects to return to profitability this financial year and is targeting revenue between £1.1bn and £1.53bn.
Average month end cash is expected to be between £125m and £145m.
It has also entered the new financial year with an order book of £3.2bn, and with 90 per cent of the year’s planned revenue secured.
Despite Galliford Try’s stronger outlook it has cancelled its final dividend for the year in a bid to maintain the group’s strong balance sheet.
“The group has a strong outlook and the board anticipates reinstating dividend payments, following a return to profitability”, Galliford Try said.
What Galliford Try said
Chief executive Bill Hocking said: “This year has been a period of significant change for the Group. We have successfully transitioned to a well-capitalised UK construction business and I am confident about our future.”
“The group is performing well and focusing on its core strengths of building, highways and environment. In recent months we have secured a number of significant project wins and we are well placed to benefit from planned future investment in our areas of operation.”