Morgan Sindall: lower cash pile reflects investment

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Cash levels stay cardinal to Morgan Sindall’s strategy, its main enforcement has said.

The company’s half-year results, released yesterday, showed its net-cash fig astatine the extremity of June was down by £63m, the archetypal clip successful respective years that it had fallen.

It remained astatine a steadfast £274m, but this was immoderate mode disconnected the £337m held astatine the aforesaid constituent successful 2021.

Chief enforcement John Morgan told Construction News that the alteration was owed to fulfilling connected its antecedently announced strategy of investing successful its concern lodging business, wherever it delivers homes alongside section authorities and lodging associations.

The concern concern turned implicit £284m successful the period, up from £270m successful 2021, posting an operating nett of £13.9m, which was higher than the £12.1m for the twelvemonth before.

Morgan stressed the spot of the firm’s currency pile: “The currency that matters is however overmuch currency you’ve got successful the slope astatine your worst day. We had implicit £200m connected the precise worst time [in the archetypal fractional of the year] and that’s a batch of money.

“We person our undrawn overdraft installation arsenic well, but we are looking to turn our concern lodging concern and our municipality regeneration business, truthful we volition beryllium utilizing currency and we person utilized currency to grow those.”

Its urban-regeneration concern sees it enactment arsenic a developer connected mixed-use schemes.

He added: “We’re besides making [a] profit, truthful the currency gets topped up by the retained nett each the time. What we’re committed to is having important currency successful the slope each time and, arsenic you tin imagine, it is simply a batch of cash.”

Group-wide results showed a 9 per cent maturation successful gross to a grounds £1.7bn, alongside a 2 per cent emergence successful pre-tax nett to a grounds £53.7m. Operating nett was up 4 per cent.

Asked whether nett rising astatine a slower complaint than turnover was a reflection of existent issues successful the market, Morgan dismissed the notion, saying: “I wouldn’t work excessively overmuch into that. It’s lone the archetypal six months, and it’s a grounds nett and grounds turnover, though the borderline whitethorn beryllium down slightly.

“Things spell up and down a fewer fractions of a per cent each the clip for nary existent reason. The marketplace is strong, but if it wasn’t for ostentation we’d marque much money.”

Morgan said the results should beryllium viewed arsenic portion of a bid and not connected their own, and they reflected having “a precise simple, beardown strategy implicit the past eight, 9 years of integrated growth, staying successful the markets we’re in, and conscionable making our concern amended and better.”