REG - Galliford Try Hldgs - Half-year Report
05/03/2025 07:00
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RNS Number : 3410Z Galliford Try Holdings PLC 05 March 2025
5 MARCH 2025
GALLIFORD TRY HOLDINGS PLC
HALF YEAR RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2024
CONTINUED MOMENTUM DELIVERS STRONG FIRST HALF PEFORMANCE AND INCREASED
CONFIDENCE
IN FULL YEAR DELIVERY
Strategy and Outlook
· Key successes on long term major frameworks and well placed to
support the Government's commitment to growth.
· Secure outlook with £3.9bn (H1 2024: £3.7bn) high quality,
disciplined and focused order book giving predictability to trading.
· Excellent visibility of future opportunities and revenue with 98% and
81% of projected FY25 and FY26 revenue secured.
· Good early progress against the Sustainable Growth targets for 2030.
Financial and Operational Highlights
· Revenue and adjusted profit before tax for the full financial year
are expected to be above the top end of the range of current market
expectations.(1)
· 12.7% increase in revenue to £923.2m (H1 2024: £819.1m), with
growth across our operations.
· 2.7% divisional adjusted operating margin (H1 2024: 2.5%), up 24bps
year over year and showing good progress against our strategic 4.0% target for
2030.
· 22.0% increase in adjusted profit before tax to £20.5m (2) (H1 2024:
£16.8m).
· 37.5% increase in interim dividend to 5.5p per share (H1 2024: 4.0p).
· Strong balance sheet, 12-month average month end cash at £176.4m (year
to 30 June 2024: £154.8m) together with PPP assets of £40.2m (30 June 2024
£41.8m). Net cash at 31 December 2024 of £210.0m (June 2024: £227.0m).
· New £25m unsecured Revolving Credit Facility (RCF) providing further
agility and resilience.
Financial Results H1 2025 H1 2024 Change
Revenue £923.2m £819.1m +12.7%
Adjusted operating profit(2) £17.7m £14.1m +25.5%
Divisional adjusted operating margin(3) 2.7% 2.5% +24bps
Adjusted profit before tax(2) £20.5m £16.8m +22.0%
Adjusted basic earnings per share(2) 15.7p 14.1p +11.3%
Last 12 months average month end cash £176.4m £132.7m +32.9%
Order book £3.9bn £3.7bn +6.0%
Statutory results
Revenue £923.2m £819.1m +12.7%
Profit before tax £20.0m £13.0m +53.8%
Basic earnings per share 15.3p 11.3p +35.4%
Interim dividend per share 5.5p 4.0p +37.5%
Net cash £210.0m £209.2m +0.4%
1. The range of analysts' forecasts for the year ended 30 June 2025, based on
forecasts at 28 February 2025, is £1,817m to £1,835m for revenue and
£35.4m to £36.0m for profit before tax.
2. Pre-exceptional items are now referred to as 'adjusted'. Note 17 below
contains the rationale for use, and reconciliations of these adjusted measures
to their nearest statutory measure and explanations of changes made in the
period to adjusted profit before tax and adjusted earnings per share. All
other measures and definitions remain unchanged.
3. Divisional adjusted operating margin is defined as adjusted operating
profit as a percentage of revenue. It is stated for the combined Building and
Infrastructure divisions.
Bill Hocking, Chief Executive, commented:
"The Group's excellent performance in the first half of the financial year
provides increased confidence and improved revenue, margin and profit
expectations for the full year.
In addition to our continued successes in Building and Environment we see a
pipeline of opportunities across all our chosen sectors. Our track record of
operational delivery, focused risk management, committed people and
established relationships with our supply chain and clients provides
consistency to our results.
Our recent major long-term framework wins and order book provide clear
visibility and security of future workloads well beyond the current financial
year and we welcome the Government's commitment to grow the economy by major
investment in infrastructure and development.
Our performance and future outlook give us confidence to improve our
expectations for the full year to 30 June 2025 and we are committed to
delivering long-term sustainable value for our stakeholders."
Enquiries to:
Galliford Try Bill Hocking, Chief Executive 01895 855001
Kris Hampson, Chief Financial Officer
Kevin Corbett, General Counsel & Company Secretary
Teneo James Macey White/Victoria Boxall 020 7260 2700
This announcement contains inside information. The person responsible for
making this announcement on behalf of Galliford Try is Kevin Corbett, General
Counsel & Company Secretary.
Presentations
A conference call for analysts and institutional investors will be held at
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An open presentation and Q&A session for retail investors will be held on
Friday 14 March 2025 at 10:00am GMT via the Investor Meet Company platform.
The presentation is open to all existing and potential
shareholders. Questions can be submitted pre-event via your Investor Meet
Company dashboard up until 13 Mar 2025, 09:00 GMT, or at any time during the
live presentation. Investors can register for the event via this
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FINANCIAL REVIEW
During the first half of the year, the Group delivered an excellent
performance resulting in a significant year on year increase in revenue,
profit before tax, and improved divisional adjusted operating margin. Our
operating performance, strong financial position and high-quality order book
provide confidence in our future performance.
Revenue for the half year to 31 December 2024 increased 12.7% to £923.2m (H1
2024: £819.1m). This reflects revenue increases in both Building and
Infrastructure. Our Infrastructure business (incorporating Highways and
Environment) continued to benefit from strong AMP7 spending in H1 ahead of
transitioning to the larger AMP8 frameworks.
Adjusted operating profit increased by 25.5% to £17.7m (H1 2024: £14.1m).
The combined divisional adjusted operating margin was up 24bps at 2.7% (H1
2024: 2.5%), with improvement in both Building and Infrastructure. Building
generated an adjusted operating profit of £12.5m (H1 2024: £10.6m),
representing an adjusted operating margin of 2.7% (H1 2024: 2.4%), up 29bps.
Infrastructure generated an adjusted operating profit of £12.3m (H1 2024:
£9.3m), representing an adjusted operating margin of 2.7% (H1 2024: 2.6%) up
15bps.
Adjusted profit before tax was £20.5m (H1 2024: £16.8m). See note 17
relating to changes to certain adjusted performance measures.
The taxation charge of £4.6m reflects a forecast effective tax rate of 23.8%
for the year to 30 June 2025, after allowing for prior year tax adjustments,
which compares to the standard effective tax rate of 25.0%.
Based on adjusted basic earnings per share of 15.7p (H1 2024: 14.1p), and the
outlook for the remainder of the financial year, the Board has declared an
interim dividend of 5.5p per share (H1 2024: 4.0p). Due to the strength of
results delivery in H1 and the transition to AMP8 from April, the Group
expects a more even weighting between H1 and H2 for both revenue and profits.
The Group is well capitalised, maintaining its focus on disciplined cash
management in line with the Board's key capital allocation objectives. The
Group operates with daily net cash, no drawn bank debt facilities, and no
defined benefit pension liabilities. The average month-end cash for the
rolling 12 months ended 31 December 2024 was £176.4m (year to 30 June 2024:
£154.8m) and period-end cash at 31 December 2024 was £210.0m (30 June 2024:
£227.0m).
The Group also benefits from a PPP asset portfolio of £40.2m, reflecting a
blended 7.6% discount rate and generating ongoing interest income.
The Group has established a Revolving Credit Facility (RCF) to provide greater
agility and resilience. We are pleased to have received such positive support
from three providers, which alongside an already strong balance sheet,
provides an excellent platform to take advantage of future growth
opportunities as we prepare the Group for the growth to deliver the 2030
sustainable growth targets.
· £25m for a term of three years, options to extend for two years
and an accordion option of a further £10m.
· The RCF is unsecured and provided by Barclays, Lloyds Banking
Group and the National Bank of Kuwait.
The Group is able to adopt appropriate discipline and risk management when
sourcing new work supported by our strong balance sheet which is also
important in providing confidence to our clients, staff and supply chain. We
are committed to pursuing a collaborative and open approach with our supply
chain. Our performance under the Prompt Payment Code continues to remain
strong with 97% of invoices paid within 60 days in the period (H1 2024: 97%)
and average payment being made in 26 days (H1 2024: 24 days).
DIVIDEND AND SHARE BUYBACK
The directors have reviewed the Group's results and outlook for the current
financial year and have declared an interim dividend of 5.5p per share (H1
2024: 4.0p) which will be paid on 11 April 2025 to shareholders on the
register at the close of business on 14 March 2025.
On 3 October 2024 the Group launched a share buyback programme of up to a
maximum of £10.0m of company shares. As at 28 February 2025 the Group had
purchased a total of 2,381,887 shares, for an aggregate consideration of
£8.9m. The Group expects to complete the buyback before the end of the
financial year.
OUTLOOK
The UK's planned, and reaffirmed, major investment in economic and social
infrastructure continues to support growth in our chosen markets.
Galliford Try has a predominant focus, and track record, in the public and
regulated sectors where, in addition to our places on national major long-term
frameworks, we continue to see opportunities across our chosen sectors and we
are well placed to support the Government's central commitment to grow the
economy and invest in infrastructure, such as water and transport, technology
and commercial development.
In the first half of the financial year we benefited from, inter alia,
continued strong delivery on AMP7 Environment frameworks and in our Building
frameworks, and our teams are starting work on the transition to the larger
AMP8 water plan. Our future outlook is supported by recent framework and
project wins as well as the pipeline of opportunities we see across all our
chosen sectors. We are also assisting key clients with a number of projects
following ISG's administration.
The Group enters the second half of the year with improved confidence for the
financial year to 30 June 2025 and with 81% of work secured for 2026.
Revenue and adjusted profit before tax for the full financial year are
expected to be above the top end of the range of current market expectations.
The improved guidance entirely reflects the strong trading performance and
momentum.
OPERATIONAL REVIEW
Building
Our Building business operates through regional offices, serving a range of
public and commercial clients across the UK, with a focus on the education,
defence, health and custodial sectors, and going forward in affordable homes,
where we have core and proven strengths. Building maintains a substantial
presence in Scotland, operating as Morrison Construction.
Our Facilities Management (FM) business complements these operations by
providing building maintenance services and we continue to grow the
capabilities of this operation, with a specific focus on decarbonising
existing buildings through retrofit and other enhancements.
H1 2025 H1 2024 Change
Revenue (£m) 467.3 446.0 4.8%
Adjusted Operating profit (£m) 12.5 10.6 17.9%
Adjusted Operating margin (%) 2.7 2.4 29bps
Order book (£bn) 2.3 2.2 £0.1bn
Building's revenue was up 4.8% to £467.3m (H1 2024: £446.0m) with adjusted
operating profit of £12.5m (H1 2024: £10.6m), resulting in an improved
operating margin up 29bps at 2.7% (H1 2024: 2.4%). We are focussed on margin
progression, with the improvement reflecting the performance of projects
across the business and our strategy of focusing on bottom line growth.
We have successfully won places on the new £835m NHS North of England
Commercial Procurement Collaborative and have been appointed to build two
projects in London with a combined value of £87m. We are also working with a
number of clients on various projects following ISG going into administration.
The FM business has been successfully appointed to the Pagabo £814m Total
Facilities Management Framework.
Building currently has an order book of £2.3bn (H1 2024: £2.2bn), including
25% in Education, 41% in Defence and Custodial, 13% in Facilities Management
and 3% in Health.
Infrastructure
Infrastructure, comprising primarily Highways and Environment (incorporating
principally our activities in water and wastewater), carry out critical
engineering projects across the UK. This business has established long-term
relationships with customers where we have a strong track record on delivery,
focusing on public and regulated sector work and bids with early contractor
involvement.
H1 2025 H1 2024 Change
Revenue (£m) 451.7 362.0 24.8%
Adjusted Operating profit (£m) 12.3 9.3 32.3%
Adjusted Operating margin (%) 2.7 2.6 15bps
Order book (£bn) 1.6 1.5 £0.1bn
Infrastructure revenue was up 24.8% to £451.7m (H1 2024: £362.0m) with
adjusted operating profit up 32.3% at £12.3m (H1 2024 £9.3m), resulting in
an improved adjusted operating margin up 15bps at 2.7% (H1 2024: 2.6%).
In Highways we have been appointed to build the £88.9m South East Aylesbury
Link Road. Our Environment business secured places on the £3.7bn Wessex Water
AMP8 Framework, the complex element of Yorkshire Water's £850m new
Non-Infrastructure Works Framework and Southern Water's Capital Programme
Strategic Delivery Partner Framework.
Infrastructure currently has an order book of £1.6bn (H1 2024: £1.5bn)
comprising £666m in Highways and £978m in Environment.
Investments
Investments delivers major building and infrastructure projects through public
private partnerships and the co-development of Private Rented Sector (PRS)
projects, generating work for the wider Group in the process.
H1 2025 H1 2024 Change
Revenue (£m) 4.2 11.1 (62.2)%
Adjusted Operating (loss)/profit (£m) (0.1) 0.3 £(0.4)m
Asset valuation (£m) 40.2 43.5 £(3.3)m
Net interest income (£m) 1.8 1.9 (5.3)%
For the first half of the financial year, revenue was £4.2m (H1 2024:
£11.1m) with an adjusted operating loss of £0.1m (H1 2024: adjusted
operating profit of £0.3m). The previous period included financial close fees
associated from a PRS development scheme.
At 31 December 2024 the Group directors' valuation of our PPP portfolio was
£40.2m (June 2024: £41.8m, H1 2024: £43.5m), reflecting a blended 7.6%
discount rate (June 2024: 7.6%, H1 2024: 7.3%) and capital redemptions
received. These highly marketable assets contribute to our balance sheet
strength and generated interest income in the period of £1.8m (H1 2024:
£1.9m).
SUSTAINABLE GROWTH STRATEGY TO 2030
Our strategy is to deliver high-quality buildings and infrastructure in a
socially responsible way, while providing a sustainable financial return for
our shareholders and delivering on our aspirations to create long term value
for all our stakeholders. The Group's strategic enablers are a progressive
culture, socially responsible delivery, focus on quality and innovation, and
disciplined risk management to give sustainable financial returns.
In May 2024, due to the Group's performance during the prior strategy period,
the Group updated its sustainable financial growth targets through to 2030,
which include:
Revenue growing to in excess of £2.2bn, maintaining disciplined contract selection
and robust risk management in resilient market sectors
Divisional adjusted operating margin increasing to 4.0% through a focus on both top and bottom line growth and
accelerated growth in our higher-margin adjacent market businesses
Cash retain a strong balance sheet and operating cash generation
Dividends sustainable dividends with earnings cover of 1.8x
RISK MANAGEMENT AND ORDER BOOK
The Group's strategy is founded on commercial discipline and robust risk
management. Our confidence in the Group's future performance is based on our
high quality order book, primarily in recently won long term secure
frameworks, underpinned by management's discipline and focus, and robust
outlook of a long term pipeline of opportunities. Our sector focus means 84%
of contracts are delivered through frameworks providing a reliable stream of
long term future work built on relationships with clients on known and
established terms, conditions and risk profile.
At 31 December 2024 the Group's order book was £3.9bn (H1 2024: £3.7bn) of
which 90% is in the public and regulated sectors and 10% is in the private
sector. 98% of projected revenue for the current financial year is secured,
and 81% is already secured for the next financial year (H1 2024: 98% and 83%
respectively).
CAPITAL ALLOCATION
A strong balance sheet is an important element in delivering the Group's
Sustainable Growth Strategy, as it provides a competitive advantage in the
market, supports the Group's disciplined approach, and provides confidence to
our clients and supply chain. The strong outlook across our markets remains
encouraging and supports our strategy. The Group will also always ensure that
it is prepared for any adverse change in market conditions that may arise. Our
strong balance sheet is particularly important for the Group to continue to
operate its disciplined approach to contract selection and focus on operating
margin, irrespective of any short-term economic concerns.
The Group's capital allocation priorities continue to be:
· Invest in the business (organic and acquisitive)
We are able to allocate capital to assist the development of our adjacent
markets, as demonstrated by our acquisitions. Our strong cash balance enables
the Group to react quickly to strategic opportunities, including bolt-on
acquisitions that enhance our capabilities and increase value, and to continue
to invest in enablers of growth such as digital capabilities.
· Paying sustainable dividends to shareholders
The Board understands the importance of dividends to shareholders and in
setting its dividend considers the Group's profitability, its strong balance
sheet, high-quality order book and longer term prospects. Consistent with this
approach the Group expects dividend per share to increase in line with
earnings as the business grows.
The Group has a dividend policy of adjusted earnings covering the dividend by
1.8 times. In addition to dividend growth from our operational performance,
this policy also reflects the low-risk nature of the PPP asset portfolio and
its annuity interest income and provides a sustainable increase in dividend to
shareholders while retaining capital to invest in growing the business.
· Returning excess cash
We continue to assess the cash requirements of the business to ensure the
Group remains well positioned to deliver on its Sustainable Growth Strategy
and has sufficient funds to invest in the business. As previously announced,
where average month-end cash and PPP assets increase above the level required,
the Board will consider making additional returns to shareholders where this
represents the best return for shareholders.
Environment, Social and Governance (ESG)
Sustainability underpins our long-term success as it helps us to win work,
engages our people, benefits communities and the environment, and makes us
more efficient. Our ESG Committee, chaired by the Chief Financial Officer,
monitors progress against the six pillars of our sustainability strategy,
which are mapped to the UN Sustainable Development Goals, as set out below:
Health and Safety
The health, safety and wellbeing of our people, subcontractors, suppliers,
clients and the public remains the Group's top priority.
We continue to focus on our pursuit of 'no harm' through our Back to Basics
approach of Right Person, Right Planning, Right Equipment and Right Workplace.
During the first half of the year, the Lost Time Frequency Rate (LTFR)
improved further from 0.14 to 0.11 and our Accident Frequency Rate (AFR) also
fell from 0.04 to 0.03.
Our behavioural safety programme, Challenging Beliefs, Affecting Behaviour
(CBAB) has formed the backbone of our approach since its inception in 2012
through awareness, training, coaching and visible leadership. Our CBAB
Ambassadors continue to promote the programme across our Group.
People
Retaining, gaining and developing talent remain the pillars of our people
strategy, driven by our Employee Value Proposition (EVP) 'Grow Together' which
delivers on our pledge to be a people-orientated, progressive employer driven
by our values.
We recently launched new Career Paths to help people develop professionally
and personally and understand the opportunities available to them at all
stages of their careers. In addition, our GT Academy, an online resource
centre, has been refreshed with a new set of resources, media and the ability
for employees to personalise their development experience.
We continue to promote our internal mobility programme 'Explore' which enables
employees to discover opportunities within our Group should they wish for a
change in career, location, discipline or working pattern.
We were proud to have retained our Platinum membership of The 5% Club which
recognises the business's commitment to inclusion and social mobility, future
growth of 'earn as you learn' opportunities and the quality of training and
development. We have also been voted the Best Construction and Civil
Engineering company for Apprentices, and number two for Graduates, by The Job
Crowd, the UK's only graduate and apprentice employer ranking system based on
employee feedback.
Environment and Climate Change
We recognise the importance of the climate change agenda and the role we have
to play in decarbonising the economy for a greener, more sustainable future.
Our near-term carbon reduction targets have been validated by the Science
Based Targets Initiative (SBTi) and support our ambition to achieve net zero
carbon across our own operations (Scope 1 and 2) by 2030 and across all
activities (Scope 1, 2 and 3) by 2045 at the latest.
In support of our Science-Based and net zero carbon targets, we have published
our first net zero route map. The route map identifies 16 activities where
action is required to enable our emission reduction targets including actions
in relation to the use of diesel, company vehicles, workplaces, travel,
design, construction materials, measurement, carbon charging and offsetting.
We have become one of the first organisations to be certified to PAS
2080:2023, following the expansion of PAS 2080's scope to include the entire
built environment as well as infrastructure. It is the leading standard for
carbon management in the built environment, covering the design, construction,
operation, use and end of life of new and existing assets with the aim to
reduce costs and adapt to a low-carbon future. The achievement further
evidences our ability to work with clients, consultants and suppliers to
deliver low and net zero carbon projects and to help the UK transition to a
net zero carbon economy by 2050.
Communities
Since we began reporting social value in 2022, we have delivered circa £935m
in social and local economic value through a combination of providing work for
the local supply chain, providing opportunities for training and
apprenticeships and job creation.
We are participating in Build UK's Open Doors initiative again this year. The
initiative provides an opportunity for students to gain insight into how we
operate our sites and what a career in construction can offer. Last year, 251
students and 12 projects were involved in the week-long event.
Our mentoring scheme aimed at encouraging the next generation of women into
construction has welcomed the first cohort of circa 50 students across five
schools. Mentors from our business have been paired with students over a
three-year programme that will showcase the vast and rewarding opportunities
in the sector. Individuals on the programme will benefit from upskilling their
communication skills for the workplace, career matching to their interests,
and guidance with CV writing and interviewing.
We continue to participate in the Considerate Constructors Scheme (CCS), which
assesses sites on criteria including being considerate of local neighbourhoods
and the public and we achieved an average CCS audit score of 43.5 (H1 2024:
42.7) in the six months to December 2024. The industry average is 40.5 (H1
2024: 40.4).
Clients
Providing excellent service for our clients includes the ability to unlock new
and innovative methods to deliver high quality, low carbon, value for money
projects. Our success is reflected by the fact that 92% of our order book is
repeat business (H1 2024: 88%).
We are increasingly using modern methods of construction, including digital
tools and innovative construction methodologies to improve safety, quality and
efficiency. One example of innovation is our low carbon concrete trial, in
partnership with Graphene@Manchester, CEMEX and Northumbrian Water, and funded
by a research grant from Innovate UK. The research project is seeking to
eliminate the use of carbon-intensive cement by integrating micronised
limestone and graphene-based admixtures into the concrete mix. The innovative
concrete material is being trialled at the Bran Sands site where we are
working on behalf of Northumbrian Water.
Supply Chain
We are committed to paying 95% of supply chain invoices within 60 days. We
continue to outperform this target, with 97% of invoices paid within 60 days
in the latest six months to 31 December 2024 (H1 2024: 97%) and the average
days to pay is now 26 days (H1 2024: 24 days).
We continue to minimise the risk of modern slavery within our operations and
supply chain and use the UK Government Modern Slavery Assessment tool to
assess our performance and identify opportunities for improvement. As part of
this ongoing improvement, we have undertaken an audit of our preferred
supplier labour agencies to assess their compliance, financial stability, and
ethical practices. We have also collaborated with the charity Unseen UK and a
number of other major contractors to develop and publish a video to highlight
the reality of modern slavery and the key signs to look out for.
We have been recognised for our ongoing support of the Supply Chain
Sustainability School, winning the Partner award for Supply Chain Engagement.
The Group is a partner to the school which is a leading online resource for
businesses within the built environment supply chain, aiming to upskill the
workforce and improve the understanding of best practice in sustainability.
Last year, our suppliers completed over 5,700 of the school's e-learning
modules and accessed their online learning resources over 36,000 times.
PRINCIPAL RISKS AND UNCERTAINTIES
The directors consider that the principal risks and uncertainties which may
have a material impact on the Group's performance in the second half of the
financial year remain primarily the same as those outlined on pages 56 to 60
of the Group's annual report and financial statements for the year ended 30
June 2024. Those risks the Group considers to be of particular importance and
highlighted as the principal risks in focus within the 30 June 2024 annual
report are; work winning, project delivery, resources and regulatory
compliance.
BOARD
As previously announced, Kris Hampson joined the board as Chief Financial
Officer on 2 September 2024 and Marisa Cassoni, Non-executive Senior
Independent Director and Chair of the Audit Committee, left the Group on 28
November 2024. Also, as previously announced, Kevin Boyd, who joined the
company on 1 March 2024, was appointed Non-executive Senior Independent
Director and Chair of the Audit Committee from 28 November 2024.
Condensed consolidated income statement
for the half year ended 31 December 2024 (unaudited)
Half year to Half year to
31 December 2024 31 December 2023
Notes £m £m
Revenue 4 923.2 819.1
Cost of sales (852.1) (758.4)
Gross profit 71.1 60.7
Administrative expenses (53.9) (50.4)
Operating profit 17.2 10.3
Finance income 5 4.9 4.3
Finance costs 5 (2.1) (1.6)
Profit before income tax 20.0 13.0
Income tax expense 6 (4.6) (1.7)
Profit for the period 15.4 11.3
Earnings per share
Basic 8 15.3p 11.3p
Diluted 8 14.7p 10.8p
The notes are an integral part of the condensed consolidated financial
statements.
Condensed consolidated statement of comprehensive income
for the half year ended 31 December 2024 (unaudited)
Half year to Half year to
31 December 31 December
2024 2023
Notes £m £m
Profit for the period 15.4 11.3
Other comprehensive expense:
Items that may be reclassified subsequently to profit or loss
Movement in fair value of PPP and other investments - continuing operations 10 (0.9) (0.4)
Other comprehensive expense for the period net of tax (0.9) (0.4)
Total comprehensive income for the period 14.5 10.9
The notes are an integral part of the condensed consolidated financial
statements.
Condensed consolidated balance sheet
at 31 December 2024 (unaudited)
31 December 2024 30 June 2024
(audited)
Notes £m £m
Assets
Non-current assets
Intangible assets 3.8 4.3
Goodwill 9 93.6 93.6
Property, plant and equipment 5.2 5.3
Right of use assets 52.1 51.4
PPP and other investments 10 40.2 41.8
Deferred income tax assets 12.3 15.0
Total non-current assets 207.2 211.4
Current assets
Trade and other receivables 11 332.2 370.8
Current income tax assets 2.2 11.6
Cash and cash equivalents 210.0 227.0
Total current assets 544.4 609.4
Total assets 751.6 820.8
Liabilities
Current liabilities
Trade and other payables 12 (537.0) (609.2)
Lease liabilities (22.0) (20.5)
Provisions for other liabilities and charges 13 (38.3) (36.2)
Total current liabilities (597.3) (665.9)
Non-current liabilities
Lease liabilities (32.5) (32.5)
Total non-current liabilities (32.5) (32.5)
Total liabilities (629.8) (698.4)
Net assets 121.8 122.4
Equity
Ordinary share capital 51.6 52.0
Share premium 1.0 0.8
Other reserves 136.9 136.4
Retained earnings (67.7) (66.8)
Total shareholders' equity 121.8 122.4
The notes are an integral part of the condensed consolidated financial
statements.
These condensed consolidated financial statements were approved by the Board
of Directors on 5 March 2025.
Condensed consolidated statement of changes in equity
for the half year ended 31 December 2024 (unaudited)
Notes Ordinary share capital Share Premium Other reserves Retained earnings Total shareholders' equity
£m £m £m £m £m
As at 31 December 2024
At 30 June and 1 July 2024 52.0 0.8 136.4 (66.8) 122.4
Profit for the period - - - 15.4 15.4
Other comprehensive expense - - - (0.9) (0.9)
Total comprehensive income for the period - - - 14.5 14.5
Transactions with owners:
Dividends 7 - - - (11.9) (11.9)
Share-based payments - - - 1.1 1.1
Tax relating to share-based payments - - - 1.4 1.4
Purchase of own shares 8 - - - (6.0) (6.0)
Issue of shares 0.1 0.2 - - 0.3
Cancellation of shares 8 (0.5) - 0.5 - -
At 31 December 2024 51.6 1.0 136.9 (67.7) 121.8
As at 31 December 2023
At 30 June and 1 July 2023 52.4 - 135.3 (69.1) 118.6
Profit for the period - - - 11.3 11.3
Other comprehensive expense - - - (0.4) (0.4)
Total comprehensive income for the period - - - 10.9 10.9
Transactions with owners:
Dividends 7 - - (20.2) (20.2)
Share-based payments - - 0.5 0.5
Tax relating to share-based payments 1.5 1.5
Purchase of own shares 8 - - (9.0) (9.0)
Cancellation of shares 8 (1.1) 1.1 - -
At 31 December 2023 51.3 136.4 (85.4) 102.3
The notes are an integral part of the condensed consolidated financial
statements.
Condensed consolidated statement of cash flows
for the half year ended 31 December 2024 (unaudited)
Notes Half year to Half year to
31 December 2024 31 December 2023
£m
£m
Cash flows from operating activities
Profit for the period 15.4 11.3
Adjustments for:
Income tax expense 4.6 1.7
Net finance income 5 (2.8) (2.7)
Profit before finance costs and taxation 17.2 10.3
Depreciation and amortisation 11.5 9.6
Share-based payments 1.1 0.5
Other non-cash movements - (0.5)
Net cash generated from operations before changes in working capital 29.8 19.9
Decrease/(increase) in trade and other receivables 38.8 (36.7)
(Decrease)/increase in trade and other payables (72.2) 42.8
Increase/(decrease) in provisions 2.1 (1.1)
Net cash (used in)/generated from operations (1.5) 24.9
Interest received 4.9 3.0
Interest paid (2.1) (1.6)
Corporation tax received/(paid) 9.4 (0.2)
Net cash generated from operating activities 10.7 26.1
Cash flows from investing activities
Increase in amounts due from joint ventures (2.1) (2.0)
PPP loan repayments 10 0.7 0.7
Acquisition of subsidiary, net of cash/borrowings - (3.7)
Proceeds from disposal of subsidiary, net of cash 1.9 1.8
Acquisition of property, plant and equipment (0.5) (0.6)
Net cash generated from/(used in) investing activities - (3.8)
Cash flows from financing activities
Repayment of lease liabilities (10.1) (7.6)
Purchase of own shares 8 (6.0) (5.5)
Dividends paid to Company shareholders 7 (11.9) (20.2)
Net proceeds of issue of ordinary share capital 0.3 -
Net cash used in financing activities (27.7) (33.3)
Net decrease in cash and cash equivalents (17.0) (11.0)
Cash and cash equivalents at beginning of period 227.0 220.2
Cash and cash equivalents at end of period 210.0 209.2
The notes are an integral part of the condensed consolidated financial
statements.
Notes to the condensed consolidated half year financial statements
for the half year ended 31 December 2024 (unaudited)
1 Basis of preparation
Galliford Try Holdings plc is a public limited company incorporated in England
and Wales and domiciled in the UK. The address of its registered office is
Blake House, 3 Frayswater Place, Cowley, Uxbridge, Middlesex, UB8 2AD. The
Company has its listing on the London Stock Exchange. This condensed
consolidated half year financial information was approved for issue on 5 March
2025.
This condensed consolidated half year financial information does not comprise
statutory financial statements within the meaning of Section 434 of the
Companies Act 2006. Statutory financial statements for the year ended 30
June 2024 were approved by the board of directors on 3 October 2024 and
delivered to the Registrar of Companies. The report of the auditors on those
financial statements was unqualified, did not contain an emphasis of matter
paragraph and did not contain any statement under Section 498 of the Companies
Act 2006. This condensed consolidated half year financial information has been
reviewed, not audited. The auditors' review opinion is included in this
report.
This condensed consolidated half year financial information for the half year
ended 31 December 2024 has been prepared in accordance with the Disclosure
Guidance and Transparency Rules of the Financial Conduct Authority and with UK
adopted International Accounting Standard 34, "Interim financial reporting".
The condensed consolidated half year financial information should be read in
conjunction with the annual financial statements for the year ended 30 June
2024, which have been prepared in accordance with UK adopted International
Accounting Standards.
The Group's activities, together with the factors likely to affect the future
development, performance and position of the business are set out in this half
year report. The annual financial statements for the year ended 30 June 2024
included the Group's objectives, policies and processes for managing capital,
its financial risk management objectives, details of its financial instruments
and hedging activities and its exposure to credit risk and liquidity risk.
After making enquiries, the directors have a reasonable expectation that the
Group has adequate resources to continue in operational existence for at least
twelve months from the date of signing the condensed consolidated half year
information, and accordingly continue to adopt the going concern basis of
preparation.
2 Accounting policies
The accounting policies applied are consistent with those of the annual
financial statements for the year ended 30 June 2024. There are no new
standards effective for the first time in the period beginning 1 July 2024
which have a material impact on the Group's reported results.
Critical accounting estimates and judgements
The Group's principal judgements and key sources of estimation uncertainty
remain unchanged since the year-ended 30 June 2024. The principal judgements
and key sources of estimation uncertainty are set out in note 1 on pages 147 -
149 of the annual financial statements for the year ended 30 June 2024.
The Group's five largest unagreed variations and claims positions as at 31
December 2024 are summarised in aggregate below.
£m
Overall contract value 733.3
Revenue in the period 83.5
Total estimated end of contract variations and claims 66.3
These five positions represent the most significant estimates of revenue. The
total estimated contract variations and claims of the subsequent five largest
positions is £16.8m.
3 Segmental reporting
Segmental reporting is presented in the condensed consolidated half year
financial statements in respect of the Group's business segments, which are
the primary basis of segmental reporting. The business segmental reporting
reflects the Group's management and internal reporting structure. Segmental
results include items directly attributable to the segment as well as those
that can be allocated on a reasonable basis. As the Group has no material
activities outside the UK, segmental reporting is not required by geographical
region.
The chief operating decision-makers ("CODM") have been identified as the
Group's Chief Executive and Chief Financial Officer. The CODM review the
Group's internal reporting in order to assess performance and allocate
resources. Management has determined the reportable segments of the Group to
be Building, Infrastructure, Investments and Central (primarily representing
central overheads).
The CODM assess the performance of the operating segments based on a measure
of adjusted operating profit/loss basis which excludes amortisation of
acquired intangible assets and exceptional items. This measurement basis
excludes the effects of non-recurring expenditure from the operating segments,
such as restructuring costs and impairments when the impairment is the result
of an isolated, non-recurring event. Interest income and expenditure are
included in the result for each operating segment that is reviewed by the
CODM. Other information provided to them is measured in a manner consistent
with that in the financial statements.
Half year to 31 December 2024 Building Infrastructure Investments Central Total
£m £m £m £m £m
Revenue 467.3 451.7 4.2 - 923.2
Adjusted operating profit (note 17) 12.5 12.3 (0.1) (7.0) 17.7
Finance income - 0.1 1.8 3.0 4.9
Finance costs (0.7) (1.0) - (0.4) (2.1)
Adjusted profit before taxation (note 17) 11.8 11.4 1.7 (4.4) 20.5
Amortisation of acquired intangible assets - (0.5) - - (0.5)
Exceptional items (note 17) - - - - -
Profit/(loss) before taxation 11.8 10.9 1.7 (4.4) 20.0
Income tax charge (4.6)
Profit for the period 15.4
Half year to 31 December 2023 Building Infrastructure Investments Central Total
£m £m £m £m £m
Revenue 446.0 362.0 11.1 - 819.1
Adjusted operating profit (note 17) 10.6 9.3 0.3 (6.1) 14.1
Finance income - 0.1 1.9 2.3 4.3
Finance costs (0.6) (0.7) - (0.3) (1.6)
Adjusted profit before taxation (note 17) 10.0 8.7 2.2 (4.1) 16.8
Amortisation of acquired intangible assets (0.5) (0.5) - (0.2) (1.2)
Exceptional items (note 17) - - - (2.6) (2.6)
Profit/(loss) before taxation 9.5 8.2 2.2 (6.9) 13.0
Income tax charge (1.7)
Profit for the period 11.3
Inter-segment revenue, which is priced on an arm's length basis, is eliminated
from revenue above. In the half year to 31 December 2024 this amounted to
£58.9m (31 December 2023: £41.7m), of which £1.1m (31 December 2023:
£0.2m) was in Building, £36.9m (31 December 2023: £27.1m) was in
Infrastructure, £10.2m (31 December 2023: £4.7m) was in Investments, and
£10.7m (31 December 2023: £9.7m) was in Central.
4 Revenue
Nature of revenue streams
(i) Building & Infrastructure segments
Our Construction business operates nationwide, working with clients
predominantly in the public and regulated sectors. Projects include the
construction of assets (with services including design and build, construction
only and refurbishment) in addition to the maintenance, renewal, upgrading and
managing of services across utility and infrastructure assets.
Revenue stream Nature, timing of satisfaction of performance obligations and significant
payment terms
Fixed price A number of projects within these segments are undertaken using fixed-price
contracts.
Contracts are typically accounted for as a single performance obligation; even
when a contract (or multiple combined contracts) includes both design and
build elements, they are considered to form a single performance obligation as
the two elements are not distinct in the context of the contract given that
each is highly interdependent on the other.
The Group typically receives payments from the customer based on a contractual
schedule of value that reflects the timing and performance of service
delivery. Revenue is therefore recognised over time (the period of
construction) based on an input model (reference to costs incurred to date).
Un-invoiced amounts are presented as contract assets.
No significant financing component typically exists in these contracts.
Cost-reimbursable A number of projects within these segments are undertaken using cost
reimbursable/target-price (possibly with a pain/gain share mechanism)
contracts.
These projects are often delivered under frameworks, however individual
performance obligations under the framework are normally determined at a
project level where multiple services are supplied. The Group constrains
revenue and calculates any pain/gain mechanism at the framework level where
appropriate.
The Group typically receives payments from the customer based on actual costs
incurred. Revenue is therefore recognised over time (the period of
construction) based on an input model (reference to costs incurred to date).
Un-invoiced amounts are presented as contract assets.
No significant financing component typically exists in these contracts.
Facilities management Contracts undertaken within the Building segment that provide full life-cycle
solutions to clients, are accounted for as a single performance obligation,
with revenue recognised over time and typically on a straight-line basis.
(ii) Investments segment
Our Investments business specialises in managing construction through to
operations for major building projects through public private partnerships and
co-development opportunities. The business leads bid consortia and arranges
finance, as well as making debt and equity investments (which are recycled).
Revenue stream Nature, timing of satisfaction of performance obligations and significant
payment terms
Investments The Group has investments in a number of Public-Private Partnerships (PPP)
Special Purpose Vehicles (SPVs), delivering major building and infrastructure
projects.
Development fees and land sales on co-development private rental schemes
represent a performance obligation that is recognised at a point in time when
control is deemed to pass to the customer (on financial close).
The business additionally provides management services and project manages
developments under Management Service Agreements (MSA) or separate development
arrangements. Revenue for these services is typically recognised over time as
and when the service is delivered to the customer.
The business additionally provides management services to the SPVs under
Management Service Agreements (MSA). Revenue for these services is typically
recognised over time as and when the service is delivered to the customer.
Disaggregation of revenue
The Group considers the split of revenue by operating segment to be the most
appropriate disaggregation.
All revenue in the period to 31 December 2024 has been derived from
performance obligations settled over time. In the period to 31 December 2023,
all revenue was derived from performance obligations settled over time except
for £7.3m, that was recognised at a point in time within the investments
segment.
5 Net finance income
Group Half year to Half year to
31 December 2024 31 December 2023
£m £m
Interest receivable on bank deposits 3.0 2.4
Interest receivable from PPP investments and joint ventures 1.9 1.9
Finance income 4.9 4.3
Other (including interest on lease liabilities) (2.1) (1.6)
Finance costs (2.1) (1.6)
Net finance income 2.8 2.7
6 Income tax expenses
The adjusted effective tax rate (being the effective tax rate applicable to
the adjusted profit before tax) for the period is 22.9% (31 December
2023:15.2%). The expected statutory and adjusted effective tax rates for the
full year to 30 June 2025 are 23.8%. This is lower than the statutory tax rate
applicable to the period to 30 June 2025, largely due to the recognition of
deferred tax assets as part of a change in estimate since the year end 2024.
All remaining unutilised tax losses have now been recognised. The Group
previously disclosed that it had not recognised £53.0m of trading losses due
to them being subject to agreement with HMRC. During the year to 30 June 2024
HMRC confirmed the quantum of the trading losses available and that they could
be utilised against historical trading profits, resulting in a cash refund of
£9.6m and associated interest of £0.8m. These were not recognised at 31
December 2023. The cash refund was received during the interim period to 31
December 2024.
7 Dividends
The following dividends were paid and recognised by the Company in each
accounting period presented:
Half year to 31 December 2024 Half year to 31 December 2023
£m pence per share £m pence per share
Previous year net final 11.9 11.5 7.7 7.5
Special - - 12.5 12.0
Dividend recognised in the year 11.9 11.5 20.2 19.5
The following dividends were declared by the Company in respect of each
accounting period presented:
Half year to 31 December 2024 Half year to 31 December 2023
£m pence per share £m pence per share
Interim 5.6 5.5 4.1 4.0
Dividend relating to the year 5.6 5.5 4.1 4.0
The interim dividend for 2025 of 5.5 pence per share was approved by the board
on 5 March 2025 and has not been included as a liability as at 31 December
2024. This interim dividend will be paid on 11 April 2025 to shareholders who
are on the register at the close of business on 14 March 2025.
8 Earnings per share
Basic and diluted earnings per share
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of ordinary shares
outstanding during the year, excluding those held by the Employee Share Trust,
which are treated as cancelled.
The average number of shares is diluted by reference to the average number of
potential ordinary shares held under option in the period. The dilutive
effects amount to the number of ordinary shares which would be purchased using
the aggregate difference in value between the market value of shares and the
share option price. Only shares that have met their cumulative performance
criteria are included in the dilution calculation. The Group has two classes
of potentially dilutive ordinary shares: those share options granted to
employees where the exercise price is less than the average market price of
the Company's ordinary shares during the year and the contingently issuable
shares under the Group's long term incentive plans. A loss per share cannot
be reduced through dilution, hence this dilution is only applied where the
Group has reported a profit.
The purchase of own shares represents shares purchased by the Galliford Try
Employee Share Trust for £nil (31 December 2023: £1.1m) and other share
related transactions of £2.2m (31 December 2023: £3.5m), in addition to
£3.8m (31 December 2023: £4.4m) purchased by the Company as part of the
share buyback programmes announced in September 2022 and October 2024.
During the period to 31 December 2024, 1,046,575 shares have been purchased
for a consideration of £3.8m as part of the share buyback announced in
October 2024.
The earnings and weighted average number of shares used in the calculations
are set out below.
Half year to 31 December 2024 Half year to 31 December 2023(1)
Earnings Weighted average number of shares Per share amount pence Earnings £m Weighted average number of shares Per share amount pence
£m
Total operations
Basic EPS
Earnings attributable to ordinary shareholders 15.4 100,308,548 15.3 11.3 100,358,176 11.3
Basic EPS - Adjusted (note 17)
Adjusted earnings attributable to ordinary shareholders 15.8 100,308,548 15.7 14.2 100,358,176 14.1
Effect of dilutive securities:
Options n/a 4,325,110 n/a n/a 4,497,594 n/a
Diluted EPS 15.4 104,633,658 14.7 11.3 104,805,770 10.8
Diluted EPS - Adjusted (note 17) 15.8 104,633,658 15.1 14.2 104,805,770 13.6
(1) Adjusted EPS - basic and diluted, were previously reported as 13.2p and
12.7p respectively. The change reflects the adjusted profit measure
excluding the amortisation of acquired intangible assets, which previously had
been included. Refer to note 17 for further details.
9 Goodwill
Goodwill is allocated to the Group's cash-generating units (CGUs) identified
according to business segment. The goodwill is attributable to the following
business segments:
31 December 2024 30 June 2024
(audited)
£m £m
Building 40.0 40.0
Infrastructure 53.6 53.6
93.6 93.6
As stated in the annual financial statements for the year ended 30 June 2024,
detailed impairment reviews were carried out for all business segments.
Consideration has been given as to whether any events have occurred since the
year ended 30 June 2024 which could give rise to an impairment trigger. No
impairments have been identified from these reviews.
10 PPP and other investments
31 December 2024 30 June 2024
£m (audited)
£m
At 1 July 41.8 44.6
Disposals and subordinated loan repayments (0.7) (1.3)
Movement in fair value (0.9) (1.5)
At 31 December and 30 June 40.2 41.8
The portfolio reflects a blended discount rate of 7.6% (30 June 2024: 7.6%).
An increase/reduction of 0.5% (which is considered an appropriate range given
the relatively low risk associated with the portfolio) would result in a
corresponding decrease/increase in the fair value of approximately £1.4m (30
June 2024: £1.5m).
11 Trade and other receivables
31 December 2024 30 June 2024
(audited)
£m £m
Amounts falling due within one year:
Trade receivables 45.5 43.7
Less: Provision for impairment of receivables (0.4) (0.4)
Trade receivables - net 45.1 43.3
Contract assets 246.3 290.1
Amounts due from joint venture undertakings 2.9 0.8
Research and development expenditure credits 5.4 5.4
Prepayments and other receivables 32.5 31.2
332.2
370.8
12 Trade and other payables
31 December 2024 30 June 2024
(audited)
£m £m
Trade payables 97.6 107.6
Contract liabilities 110.7 121.8
Other taxation and social security payable 67.4 70.4
Accruals and other payables 261.3 309.4
537.0 609.2
13 Provisions for other liabilities and charges
Group Onerous contracts Rectification Total
£m
At 1 July 2024 1.5 34.7 36.2
Utilised (0.4) (7.4) (7.8)
Additions - 9.9 9.9
At 31 December 2024 1.1 37.2 38.3
Onerous contract provisions are made on loss-making contracts the Group is
obliged to complete. Rectification provisions are made for potential claims
and defects for remedial works against work completed by the Group and
includes provisions for dilapidations on premises the Group occupies.
The Group regularly engages in contracts with general or defect warranty
rectification requirements, typically less than 3 years. Within the pool of
open warranty period contracts, the group built, as part of a joint venture
arrangement with 2 other partners, a single infrastructure scheme under a
contract that included various defect warranty obligations, with the longest
obligation lasting up to 12 years. At 31 December 2024, there remained up to 7
years of the longest warranty liability period remaining. This is the only
contract the Group has that has a general defect warranty period of this
length. The contractual nature of the defect warranty liability and the
completion of the scheme are the obligating events and the Group, as part of
the joint operation, has remediated items since completion and has other known
issues ongoing that will likely result in future cash outflows, though the
timing and quantum remain uncertain. The Group also believes that there will
be further unknown but probable cash outflows relating to as yet unknown items
as scheduled inspections of various structural elements of the scheme are
completed that have a potentially material range of outcomes.
The Group has provided £14.5m (30 June 2024: £14.6m) against future defect
costs on this contract and this represents management's best estimate of
potential future payments associated with the warranty rectification
responsibilities. The provision requires a limited number of significant
estimates and assumptions by management, with a significant level of
estimation risk as a result arising from the level of defects and associated
cost that may arise. Management estimates the reasonable range of estimates to
be between £7.2m and £17.7m at 31 December 2024. Management has sought input
from external experienced industry figures and industry bodies to support the
provision it has made. During the period £0.1m of the opening provision was
utilised, with no additions made in the period.
Due to the nature of the provisions, the timing of any potential future
outflows is uncertain, however they are expected to be utilised within the
Group's normal operating cycle, and accordingly are classified as current
liabilities. Of the total provisions, £25.0m (30 June 2024: £24.6m) is
likely to be utilised within 12 months, with the remainder utilised in more
than 12 months. The impact of discounting is not material.
14 Financial instruments
The Group's activities expose it to a variety of financial risks. The
condensed consolidated half year financial statements do not include all
financial risk management information and disclosures required in the annual
financial statements; they should be read in conjunction with the Group's
financial statements for the year ended 30 June 2024.
There have been no significant changes in the risk management policies since
the year end.
Fair value estimation
Specific valuation techniques used to value financial instruments are defined
as:
i. Level 1 - Quoted market prices or dealer quotes in active
markets for similar instruments.
ii. Level 2 - The fair value of equity securities and interest rate
swaps is calculated as the present value of the estimated future cash flows
based on observable yield curves.
iii. Level 3 - Other techniques, such as discounted cash flow
analysis, are used to determine fair value for the remaining financial
instruments.
The following table presents the Group's assets that are measured at fair
value:
31 December 2024 30 June 2024 (audited)
Level 3 Total Level 3 Total
£m £m £m £m
Assets
Other investments
- PPP and other investments 40.2 40.2 41.8 41.8
Total 40.2 40.2 41.8 41.8
There were no transfers between levels during the period. The valuation
techniques used to derive level 3 fair values are consistent with those set
out in the 30 June 2024 financial statements. Level 3 fair values are
determined using valuation techniques that include inputs not based on
observable market data. For all other financial instruments, the fair value is
materially in line with the carrying value. The key assumptions used in Level
3 valuations include the expected timing of receipts, credit risk and discount
rates. The typical repayment period is 10-15 years and the timing of receipts
is based on historical data.
During the period, government gilts have decreased, while the base rate has
increased. The underlying assets remain low risk and insulated from short term
changes to the macro-economic environment. The fair value of the portfolio
reflects a blended discount rate of 7.6%(30 June 2024: 7.6%) and is based on
current market conditions. The sensitivity to discount rates is set out in
note 10. If receipts were to occur earlier than expected, the fair value
could increase.
15 Guarantees and contingent liabilities
The Group has surety bonding facilities and bank guarantees. These are
supported by counter indemnities given by the Company and certain subsidiaries
in the Group in the normal course of business. Utilisation of the bonding and
guarantee facilities total £166.2m at 31 December 2024 (30 June 2024:
£182.1m). It is not expected that any material liabilities will arise.
Disputes arise in the normal course of business, some of which lead to
litigation or arbitration procedures. While the outcome of disputes and
arbitration is never certain, the directors believe that the resolution of all
existing actions will not have a material adverse effect on the Group's
financial position. Where the Group has received such claims, the directors
have made provision in the financial statements when they believe it is
probable a liability exists and it can be reliably estimated, but no provision
has been made where the Group's liability is considered only possible or
remote. This is based on the best estimates of future costs to be incurred
after assessing all relevant information and taking legal advice where
appropriate.
The Group has currently assessed a pool of non-fire safety related claims that
meet the contingent liability threshold for disclosure. These claims are of a
similar nature with a collective range of between £nil and £20.3m. The
Group's assessment of liability and estimates of future costs could change in
the future. Although the Group has appropriate insurance arrangements in place
that should mitigate any significant exposure, the recognition thresholds
under IAS 37 would mean a liability could be recognised before a corresponding
asset.
The continuing evolution of Government legislation and guidance, such as the
Building Safety Act and its implications for cladding solutions used on
historical contracts, also creates ongoing uncertainty that the Group manages.
The Group is tracking a pool of three fire safety claims which meet the
definition of contingent liabilities under IAS37. Management do not consider
it is practicable to value the pool because of the lack of supporting evidence
from the claimants and the length of time it takes for these cases to evolve
and for any reliable quantum, if any, to be established. Factors include the
complexity of the building projects in question, the many suppliers involved
in the supply chain and the potential for reimbursement from subcontractors.
The Group believes it has strong legal positions with contractual support on
all the cases, however, at this time, it cannot fully rule out that material
settlements may result, should this be the case, management expects there will
be recovery from the supply chain, designers or insurers that can be full or
partial.
As Government legislation and guidance changes in the future, the Group will
reassess the estimates made accordingly.
16 Related party transactions
Since the last Group annual financial statements for the year ended 30 June
2024, there have been no significant changes to the nature of related party
transactions.
17 Adjusted performance measures
Throughout the Interim statement, the Group has presented financial
performance measures which are used to manage the Group's performance. These
financial performance measures are chosen to provide a balanced view of the
Group's operations and are considered useful to investors as they provide
relevant information on the Group's performance. They are also aligned to
measures used internally to assess business performance in the Group's
budgeting process and when determining compensation. An explanation of the
Group's financial performance measures and appropriate reconciliations to its
statutory measures are provided below.
Measuring the Group's performance
The following measures are referred to in this report:
Statutory measures
Statutory measures are derived from the Group's reported financial statements,
which are prepared in accordance with UK adopted International Accounting
Standards and in line with the Group's accounting policies. The Group's
statutory measures take into account all of the factors, including exceptional
items which do not reflect the ongoing underlying performance of the Group.
Adjusted performance measures
In assessing its performance, the Group has adopted certain non-statutory
measures that more appropriately reflect the underlying performance of the
Group. These typically cannot be directly extracted from its financial
statements but are reconciled to statutory measures below:
a) Adjusted performance
The Group adjusts for certain significant irregular (exceptional) items as
well as the amortisation of acquired intangible assets which the Board
believes assist in understanding the performance achieved by the Group.
Previously, the Group had referred to pre-exceptional performance which
excluded the impact of exceptional items only. The exclusion of exceptional
items as well as the amortisation of acquired intangibles seeks to reflect the
underlying and ongoing performance of the business with a consistent
methodology across all the adjusted performance measures. The adjusting items
and associated tax impacts that the Group has recognised are shown below.
Half year to Half year to
31 December 2024 31 December 2023
£m £m
Implementation costs of cloud based arrangements(1) - administrative expenses -- (2.6)
Amortisation of acquired intangible assets (0.5) (1.2)
Loss before tax (0.5) (3.8)
0.1 0.9
Associated tax credit on items above
Total (0.4) (2.9)
(1) The Group incurred £nil (31 December 2023: £2.6m) of customisation and
configuration costs associated with the move to Oracle Fusion, a cloud-based
computing arrangement, during the period. Taking into account the IFRIC Agenda
Decision issued by the IFRS IC in March 2021, the Group has analysed the costs
and concluded that these costs should be expensed in the period. In accordance
with the Group's existing accounting policy, management considers that the
costs should be separately disclosed as exceptional items because they are
significant and irregular. The move to Oracle Fusion is now complete with no
further exceptional items expected.
A reconciliation of the statutory measure to the adjusted measure is provided
in the following tables.
b) Adjusted operating profit/(loss) and operating margin
The Group presents operating profit excluding exceptional items and the
amortisation of acquired intangible assets as this reflects the ongoing
performance of the business, which is referred to as adjusted operating
profit/(loss). Operating margin reflects the ratio of adjusted operating
profit/(loss) and revenue. This differs from the statutory measure of
operating profit which includes exceptional items and the amortisation of
acquired intangible assets. Divisional adjusted operating margin is the
combined adjusted operating margin of the Building and Infrastructure
segments.
A reconciliation of the statutory measure to the Group's performance measure
is shown below, based on continuing operations:
Building Infrastructure Investments Central Total
£m
£m
£m
£m
£m
Half year ended 31 December 2024
Statutory operating profit/(loss) 12.5 11.8 (0.1) (7.0) 17.2
Exclude: amortisation of acquired intangible assets - 0.5 - - 0.5
Adjusted operating profit/(loss) 12.5 12.3 (0.1) (7.0) 17.7
Revenue 467.3 451.7 4.2 - 923.2
Adjusted operating margin 2.7% 2.7% n/a n/a 1.9%
Building Infrastructure Investments Central Total
£m
£m
£m
£m
£m
Half year ended 31 December 2023
Statutory operating profit/(loss) 10.1 8.8 0.3 (8.9) 10.3
Exclude: amortisation of acquired intangible assets 0.5 0.5 - 0.2 1.2
Exclude: exceptional items (see 17a above) - - - 2.6 2.6
Adjusted operating profit/(loss) 10.6 9.3 0.3 (6.1) 14.1
Revenue 446.0 362.0 11.1 - 819.1
Adjusted operating margin 2.4% 2.6% n/a n/a 1.7%
c) Adjusted profit before tax
The Group uses a profit before tax measure which excludes exceptional items
and amortisation of acquired intangible assets as noted above, whereas the
statutory measure includes both. Since the prior year, management have changed
the definition of adjusted profit before tax by excluding the amortisation of
acquired intangible assets to align with the measurement of adjusted operating
profit with the same rationale.
A reconciliation of the statutory measure to the Group's performance measure
is shown below, based on continuing operations:
Half year to 31 December 2024 Half year to 31 December 2023(1)
£m £m
Statutory profit before tax 20.0 13.0
Exclude: amortisation of acquired intangible assets 0.5 1.2
Exclude: exceptional items (see 17a above) - 2.6
Adjusted profit before tax 20.5 16.8
(1) Previously the adjusted profit before tax measure included the
amortisation of acquired intangible assets.
d) Adjusted earnings per share
In line with the Group's measurement of adjusted performance, the Group also
presents its earnings per share on the same adjusted basis as adjusted
profit before tax. This differs from the statutory measure of earnings per
share which includes both exceptional items and amortisation of acquired
intangible assets. Since the prior year, management have changed the
definition of adjusted earnings per share by excluding the amortisation of
acquired intangible assets to align with the measurement of adjusted operating
profit with the same rationale.
A reconciliation of the statutory measure to the Group's performance measure
is shown below, based on continuing operations:
Half year to 31 December 2024
Earnings Ave number of shares EPS
£m
pence
Statutory results 15.4 100,308,548 15.3
Exclude: amortisation of acquired intangible assets 0.4 n/a n/a
Exclude: exceptional items (see 17a above) - n/a n/a
Adjusted earnings per share 15.8 100,308,548 15.7
Half year to 31 December 2023
Earnings Ave number of shares EPS
£m
pence
Statutory results 11.3 100,358,176 11.3
Exclude: amortisation of acquired intangible assets 0.9 n/a n/a
Exclude: exceptional items (see 17a above) 2.0 n/a n/a
Adjusted earnings per share(1) 14.2 100,358,176 14.1
( )
(1) Adjusted earnings per share was previously reported as 13.2p. The change
reflects the adjusted profit measure excluding the amortisation of acquired
intangible assets, which previously were included.
18 Events after the reporting date
As reported in note 7, an interim dividend of 5.5p per share has been declared
for the six months ended 31 December 2024. The Group has also announced a
£25.0m unsecured RCF. The £10.0m share buyback announced in October 2024
continues to progress. There are no other events after the reporting date to
disclose.
Forward looking statements
Certain statements in this half year report are forward looking. Such
statements should be treated with caution as they are based on current
information and expectations and are subject to a number of risks and
uncertainties that could cause actual events or outcomes to differ materially
from expectations.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the directors. The directors are responsible for preparing the
half-yearly financial report in accordance with the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial Conduct Authority.
The condensed set of financial statements has been prepared in accordance with
International Accounting Standard 34, 'Interim Financial Reporting' as adopted
by the UK.
The directors confirm that these condensed consolidated half year financial
statements have been prepared in accordance with IAS 34 as adopted by the UK;
and that the interim management report herein includes a fair review of the
information required by DTR 4.2.7 and DTR 4.2.8 namely:
· an indication of important events that have occurred during
the six months and their impact on the condensed set of financial statements,
and a description of the principal risks and uncertainties for the remaining
six months of the financial year; and
· material related party transactions in the first six months
and any material changes in the related party transactions described in the
last annual report.
The directors of Galliford Try Holdings plc are:
Alison Wood
Non-executive Chair
Bill Hocking Chief Executive
Kris Hampson Chief Financial Officer
Kevin Boyd Non-executive Director
and Senior Independent Director
Sally Boyle Non-executive Director
Michael Topham Non-executive
Director
( )
Signed on behalf of the Board.
Bill Hocking
Chief Executive
Kris Hampson
Chief Financial Officer
5 March 2025
INDEPENDENT REVIEW REPORT TO GALLIFORD TRY HOLDINGS PLC
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half year report
for the six months ended 31 December 2024 is not prepared, in all material
respects, in accordance with UK adopted International Accounting Standard 34
and the Disclosure Guidance and Transparency Rules of the United Kingdom's
Financial Conduct Authority.
We have been engaged by the company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 31
December 2024 which comprises the Condensed consolidated income statement, the
Condensed consolidated statement of comprehensive income, the Condensed
consolidated balance sheet, the Condensed consolidated statement of changes in
equity and the Condensed consolidated statement of cash flows and the related
Notes to the condensed half year financial statements.
Basis for conclusion
We conducted our review in accordance with Revised International Standard on
Review Engagements (UK) 2410, "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" ("ISRE (UK) 2410
(Revised)"). A review of interim financial information consists of making
enquiries, primarily of persons responsible for financial and accounting
matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with
International Standards on Auditing (UK) and consequently does not enable us
to obtain assurance that we would become aware of all significant matters that
might be identified in an audit. Accordingly, we do not express an audit
opinion.
As disclosed in note 1, the annual financial statements of the Group are
prepared in accordance with UK adopted international accounting standards. The
condensed set of financial statements included in this half-yearly financial
report has been prepared in accordance with UK adopted International
Accounting Standard 34, "Interim Financial Reporting.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on the review
procedures performed in accordance with ISRE (UK) 2410 (Revised), however
future events or conditions may cause the Group to cease to continue as a
going concern.
Responsibilities of directors
The directors are responsible for preparing the half-yearly financial report
in accordance with the Disclosure Guidance and Transparency Rules of the
United Kingdom's Financial Conduct Authority.
In preparing the half-yearly financial report, the directors are responsible
for assessing the company's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to
liquidate the company or to cease operations, or have no realistic alternative
but to do so.
Auditor's responsibilities for the review of the financial information
In reviewing the half-yearly report, we are responsible for expressing to the
company a conclusion on the condensed set of financial statements in the
half-yearly financial report. Our conclusion, including our Conclusions
relating to going concern, are based on procedures that are less extensive
than audit procedures, as described in the Basis for conclusion paragraph of
this report.
Use of our report
Our report has been prepared in accordance with the terms of our engagement to
assist the company in meeting the requirements of the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial Conduct Authority and for
no other purpose. No person is entitled to rely on this report unless such a
person is a person entitled to rely upon this report by virtue of and for the
purpose of our terms of engagement or has been expressly authorised to do so
by our prior written consent. Save as above, we do not accept responsibility
for this report to any other person or for any other purpose and we hereby
expressly disclaim any and all such liability.
BDO LLP
Chartered Accountants
London, UK
5 March 2025
BDO LLP is a limited liability partnership registered in England and Wales
(with registered number OC305127).
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