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North Midland Construction shares jump a third as profit doubles

The construction and engineering group said its order book for completion this year stands at £320mln compared to £270mln last year
A building site
North Midland doubled its year-on-year profit in the first-half of 2018

North Midland Construction PLC (LON:NMD) shares jumped by more than a third after it reported a doubling of first-half profits and strong growth in its order book.

The construction, engineering and management consultancy group posted a profit before tax of £2.51mln – more than double last year’s £1.23mln – on revenues 19% higher at £160.9mln in the six months to the end of June.

Future trading outlook remains positive​

The company, which has proposed to double the interim dividend to 6p per share, said its order book for completion this year stands at £320mln compared to £270mln at the same time last year.

North Midland’s telecoms division suffered a £1.6mln loss and dragged the built environment unit of the business into a small operating loss. However, its construction business delivered an operating profit of £1.2mln on revenues 95% higher at £21.98m.

"These results demonstrate the continued progress made in the business against our strategic objectives. Our focus on margin enhancement and cash generation is beginning to show returns and is anticipated to continue going forward,” North Midland’s CEO John Horner said in the results statement.

“The outlook for future trading remains positive and provides the opportunity to maximise earnings from our operations. The board is anticipating further revenue growth coupled with an enhanced margin percentage,” he added.

Shares in the company were up 34.5% at 452p in late morning trade.

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