Galliford Try successfully dispose of Linden Homes but H1 revenues fall

Galliford Try plc (LON:GFRD) have seen their shares in red as the firm published its’ half year results this morning.

The firm said that it had successfully disposed of its’ Linden Homes and Partnerships division – which was completed on January 3.

Looking at the figures for Galliford Try – the firm said that its’ revenues had fallen across the first half of 2020 from £728 million to £636 million.

Additionally, the firm noted that it had swung to a loss of £6.7 million in the half period from a profit of £2.9 million in 2019.

The firms’ order book remained flat – totaling £3.2 billion across both periods.

Bill Hocking, Chief Executive, commented: “This has been a period of significant change with the successful strategic disposal of the Group’s housebuilding divisions transforming Galliford Try into a well-capitalised, UK construction-focused business.

The restructured Group is performing well with a number of recent significant project wins, and I’m pleased to report the results for the first half of the year.

Galliford Try has continued to maintain a strong pipeline of work in its chosen sectors, with excellent positions on several key frameworks in the public and regulated sectors. We are encouraged by the demand in our sectors and look to further enhance this position through the continued disciplined approach to project selection and rigorous risk management.

The Group’s focus remains on safe and efficient project delivery and disciplined bottom line growth. We have a strong executive board and management team who are focused on a values-driven, people-orientated, progressive company, working together to deliver for our clients and stakeholders. I am confident that our clear strategy will deliver sustainable results.”

Going forward, Galliford Try have said that they intend to maintain a high quality order book. In their current financial year, 96% of projected revenue is secured and 72% secured for the next financial year.

The firm also noted that it is wary and assessing the current situation with the coronavirus outbreak, and is taking measures to mitigate harm.

Galliford Try declared an interim dividend of 1.0p per share which will be paid on 17 April 2020.

Galliford Try agree deal with Bovis Homes

In November, the firm told the market that it had agreed a substantial home building deal, for Bovis Homes (LON:BVS) to takeover two Galliford housebuilding business units.

The deal was valued at £1.4 billion, and the firm said that this deal was close to being completed today.

The agreement comes after Galliford rejected a £1.05 billion bid from rival Bovis for its Linden Homes and Partnerships & Regeneration businesses back in May.

In September the two confirmed they had resumed talks. Bovis was to issue shares worth £675 million and pay £300 million in cash, combined with £100 million of Galliford debt.

The two firms announced that the terms from the September agreement were unchanged, and will see will see Bovis issue 63.8 million new shares to Galliford, valued at £675 million, pay £300 million in cash, and take over Galliford’s £100 million debt.

The transaction values the two Galliford businesses at a combined £1.14 billion, and gives Galliford a 29% stake in the expanded Bovis group. It leaves Galliford with its’ construction business intact.

Shares in Galliford Try trade at 123p (-12.66%). 12/3/20 11:22BST.

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