Kier Group shares tumble despite record £11bn order backlog

Despite hiking dividends by a fifth and reporting a record £11bn order backlog, shares in Kier Group took a tumble this morning.

The London-listed firm announced it would pay investors an interim dividend of 2p, marking a 20 per cent increase from last year's 1.67p, as reported by City AM.

Kier Group's record £11bn order book saw a two per cent year-on-year rise, securing 98 per cent of its full-year revenue to date.

However, shares dropped more than ten per cent in early deals, contrary to some analysts' predictions of a rise.

On an adjusted basis, the half-year operating profit saw a three per cent increase to £66.6m, while revenue rose five per cent to £1.98bn.

"These developments are testament to the hard work and commitment of our people who have enhanced our resilience and strengthened our financial position," stated Andrew Davies, Chief Executive.

Davies assured shareholders that Kier was trading in line with the Board's expectations, following a solid start to the year.

"The group is confident in sustaining the strong cash generation achieved over the last few years and is well positioned to continue benefiting from UK Government infrastructure spending commitments," he added.

He further noted: "Kier operates in markets which are vital to the UK. We remain committed to delivering our long-term sustainable growth plan which will benefit all stakeholders."

Kier Group also managed to reduce its average month-end net debt by 72 per cent to £37.6m.

Shares have faltered in the current year, declining by 4.8 per cent amidst a backdrop of political and economic turmoil.

Kier has expressed confidence in its positioning to capitalise on the UK government's escalated infrastructure expenditure, noting that approximately 91 per cent of its contract portfolio is with the public sector.