Kier targets HS2 boost as Hinkley Point bolsters profits

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Builder Kier is hoping to claim a share of a £12 billion bonanza from the HS2 London-to-Birmingham rail link fresh from the approval of Hinkley Point’s new nuclear power station.

Kier is already landscaping at Hinkley, moving some five million cubic metres of earth ahead of the construction of the £18 billion site.

But boss Haydn Mursell has also teamed up with Carillion and France’s Eiffage to bid for HS2 enabling works deals — each of which is worth around £300 million — as well as four of the seven main civil engineering packages on the 140-mile line, worth up to £900 million each.

Fears over the rising cost of the £55 billion project prompted MPs to call for a “realistic timetable” for the project, whose first phase is due for completion in 2026. “From what we know the enabling works will be awarded to contractors in the next couple of months,” Mursell said.

Liberum analyst Joe Brent said the firm could also be well placed to benefit from any roads spending by Chancellor Philip Hammond to boost growth.

“Highways, which has a quick flash to bang, should also feature in the autumn statement,” he said.

Kier’s revenues jumped 26% to £4.2 billion in the year to June 30 and pre-tax profits rose 45% to £125 million, before £116 million in costs incurred by its swoop for consultant Mouchel last year.

The dividend was up 17% to 64.5p.

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September 22, 2016 |
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