Laing O’Rourke has published its accounts for FY2023 and provided an update on trading during the first half of FY2024.
For FY2023, the Group recorded top line revenue growth of 13 per cent against the previous year, pulling in £3.4 billion.
Its order book was valued at a record £10 billion, up 16 per cent on the prior year (FY2022: £8.6 billion), bolstered by healthcare, energy, transport, and defence infrastructure projects in the UK.
Laing O’Rourke finished the year with a net cash position of £286.3 million.
And during the first half of FY2024 (to 30 September 2023), revenue increased 22 per cent to £31.4 million EBIT.
However, the Group reported a pre-exceptional EBIT loss of £78.8 million due to the impact of “unprecedented” inflation on a small number of UK fixed-price contracts, compared to £95.5 million profit in FY2022.
It also recorded a post-exceptional EBIT loss of £273.9 million, compared to £19.8 million profit in the previous financial period.
This was due to a £143.7 million provision in FY2023 taken in relation to a long-running legacy contract signed in Australia in 2010.
“The adjustment had no immediate cash impact and has not impacted operations or the Group’s ability to deliver projects,” said Laing O’Rourke. “The Australia business is underpinned by a strong balance sheet and solid cash generation, with a year-end cash position of AUD$416.9m.”
Its finance facility with HSBC has also been extended by two years, to April 2026.
“Together with the whole UK construction sector, we were presented with extremely challenging market conditions during this trading period,” said Rowan Baker, CFO. “Unprecedented inflation impacted margins on a small number of our fixed-price projects in the UK. And while it had no immediate cash impact, provision for an exceptional item on a legacy project in Australia added to our loss.
“We have seen strong performance across the business in the first half of the current financial year. Our revenue increased 22 per cent versus the same period prior year, and results are well ahead of management’s expectations at £31.4m EBIT.”
Chief executive, Ray O’Rourke, added: “The work we have done over a number of years has ensured Laing O’Rourke remains a resilient business and I thank all our colleagues for their hard work. With a record order book and a return to profitability in the first half of FY24, I remain very positive about the future.”
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