Profits and cost savings to increase at Carillion
Support services giant Carillion said it expects operating margin and underlying profit to "increase significantly" by its year-end of 31 December.
Cost savings from its Energy Services divison are also expected to be ramped up.
In a pre-close update released this morning (7 December), the Wolverhampton-based company said that cashflow "remains strong" with year-end net debt now expected to be below £100m.
Despite last week announcing plans to cut up to 1,500 jobs from its newly acquired Energy Services division, Carillion said the integration of the business was ahead of expectations, adding: "We continue to target strong returns from this acquisition".
The company said it would downsize its solar photo voltaic operations following the government's proposed changes to Feed-in-Tariffs.
Total cost savings from Carillion Energy Services, which formerly traded as Eaga, are now expected to increase from £15m per year to £25m by the end of 2013.
The company said total revenue in 2011 was expected to be "broadly similar" to that in 2010, which it attributed to increased revenues in support services offset by lower revenue in UK construction.
Chief executive John McDonaugh said: "We continue to expect to make further progress in 2012 and we remain well positioned to achieve our target to deliver substantial growth in UK support services from 2012 onwards and the medium-term growth that we announced in 2010, namely to double our revenues in the Middle East and in Canada, in each case to around £1bn over three to five years."
