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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Kier Group Plc | LSE:KIE | London | Ordinary Share | GB0004915632 | ORD 1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
2.20 | 1.74% | 128.40 | 127.00 | 128.00 | 128.00 | 126.40 | 126.80 | 1,861,456 | 16:35:23 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Gen Contractor-oth Residentl | 3.41B | 41.1M | 0.0921 | 13.88 | 570.39M |
TIDMKIE
RNS Number : 6744B
Kier Group PLC
09 October 2020
9 October 2020
Kier Group plc
Publication of the 2020 Annual Report
The Company has today made available on its website at https://www.kier.co.uk/investors/annual-report-2020/ its annual report and accounts for the year ended 30 June 2020 (the "Annual Report"), The Annual Report will be submitted to the National Storage Mechanism shortly, where it will be available for inspection at https:// data.fca.org.uk/#/nsm/nationalstoragemechanism .
The Company announced its results for the year ended 30 June 2020 on 17 September 2020. Additional information has been extracted from the Annual Report and is included in the Appendix to this announcement for the purposes of compliance with the Disclosure Guidance and Transparency Rules.
For enquiries, please contact:
Phil Higgins
Deputy Company Secretary
Phil.higgins@kier.co.uk
The Company's Legal Entity Identifier is 2138002RKCU2OM4Y7O48.
Cautionary statement
This announcement does not constitute an offer of securities by the Company. Nothing in this announcement is intended to be, or intended to be construed as, a profit forecast or a guide as to the performance, financial or otherwise, of the Company or the group of companies of which the Company is the holding company whether in the current or any future financial year. This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "expects", "intends", "plans", "target", "aim", "may", "will", "would", "could" or "should" or, in each case, their negative or other variations or comparable terminology. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future and may be beyond the Company's ability to control or predict. Forward-looking statements are not guarantees of future performance. Important factors that could cause these differences include, but are not limited to, general economic and business conditions, industry trends, competition, changes in government and other regulation, changes in political and economic stability and changes in business strategy or development plans and other risks. Other than in accordance with its legal or regulatory obligations, the Company does not accept any obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events or otherwise.
APPIX
The information in this Appendix has been extracted as unedited full text from the Annual Report, subject to certain non-material amendments,
Principal risks and uncertainties
The Board's assessment of the principal risks and uncertainties facing the Group and a summary of the key controls and mitigating actions are each summarised below. The Board considers these to be the most significant risks facing Kier. Not all risks facing the business are listed and the risks are not listed in any order of priority.
Principal Description Mitigating actions risk Health and Failure to maintain a safe safety and sustainable environment * Continued focus on the five basics of SHE risk and prevent a major incident. management; The Group's operations are inherently complex and potentially hazardous and require the * Implementing the Group's new sustainability framework, continuous management of 'Building for a Sustainable World'; and safety, health and sustainability issues. * Setting a tone from the top, through activities such COVID-19 impact: high. as senior management visible leadership tours. During COVID-19, the Group has worked closely with its people, clients and suppliers to ensure that its sites and offices are able to continue to operate safely and in accordance with Government guidelines. ------------------------------------- ------------------------------------------------------------- Legislation Failure to manage effectively and regulation changes in legislation and * Regular engagement with Government and Government regulation. agencies with respect to the Group's performance; The sectors in which the Group operates are subject to increasing scrutiny from * Monitoring of, and planning for, the impact of new stakeholders, oversight legislation and regulations; and from regulators and requirements introduced by new legislation or regulation. * Collaborative engagement with external stakeholders. COVID-19 impact: no material effect. ------------------------------------- ------------------------------------------------------------- Funding Failure to maintain adequate funding or liquidity. * Effective cash forecasting and working capital Reduced availability of management; financing options resulting in an inability to maintain adequate funding or financial * Following COVID-19, the Group has agreed waivers with liquidity and an inability its lenders in respect of the financial covenants for to execute the Group's strategy the test period ended 30 June 2020 and has agreed effectively. revised financial covenants which will apply for the going concern period; COVID-19 impact: medium. The Group has worked with its clients and supply chain * Collaborative engagement with customers, HMRC, to maintain liquidity during pension scheme trustees, banks, lenders and sureties; COVID-19. The Group has and agreed waivers and revised financial covenants with its lenders and worked with * Exit, substantial exit or restructuring of non-core other stakeholders to ensure businesses to reduce net debt. sufficient flexibility under its principal finance facilities remains available. ------------------------------------- ------------------------------------------------------------- Market sector A general market or sector performance downturn may materially * Evaluate markets, including the impact of and adversely affect the macroeconomic factors and the associated market risk Group's ability to secure of specific events (for example, Brexit); work. The Group's performance is affected by macroeconomic * Review the Group's pipeline of future work to factors which affect UK identify market trends and plan accordingly; and business in general and/or the markets in which the Group operates. * Maintain a broad sector focus to mitigate against the decline of a particular sector. COVID-19 impact: high . COVID-19 has resulted in high levels of macroeconomic sector uncertainty and volatility and has resulted in the UK entering a recession. This has, in turn, adversely affected the Group's financial performance. ------------------------------------- ------------------------------------------------------------- Contract Failure to manage contracts management effectively at each stage * Adhere to the Group's contract risk governance of a project's lifecycle. framework; The Group has a number of large and complex contracts in progress at any one time. * Identify early warnings of under-performing Failure to manage the risks contracts; and associated with these contracts could materially and adversely affect the Group's financial * Timely and accurate reporting of contract performance. performance. COVID-19 impact: medium. COVID-19 has resulted in certain projects being delayed or suspended and the Group incurring additional costs as a result.
------------------------------------- ------------------------------------------------------------- People Failure to retain key employees and identify future leaders. * Focus on skills development and retention plans for The Group's employees are the talent pipeline; critical to its current performance. The Group needs to identify, retain and * Create an effective, inclusive work environment, motivate people with the through our Performance Excellence culture; and right skills, experience and behaviours and to identify tomorrow's leaders. * Clear and effective communication with the workforce. COVID-19 impact: high. The Group has implemented a number of measures relating to its employees, including temporary pay reductions, furlough and requiring more agile working practices (including working from home). ------------------------------------- ------------------------------------------------------------- Supply chain Failure to maintain effective working relationships with * Develop long-term relationships with critical the supply chain; following subcontractors; COVID-19, supply chain insolvencies. The Group relies on its supply chain for the delivery * Continue to seek to reduce supply chain payment of its projects. Maintaining terms; and close and effective working relationships with the supply chain is therefore a priority * Review the supply chain to ensure alternative for the Group. Following delivery mechanisms are available and appropriate COVID-19, the risk of insolvencies contingencies are in place. in the supply chain has increased. COVID-19 impact: medium. The Group has worked closely with its supply chain to ensure that projects can be delivered. There has been an increase in the number of insolvencies within the supply chain as a result of COVID-19 ------------------------------------- ------------------------------------------------------------- Strategy The Group fails to deliver its strategy. * Delivery of our Performance Excellence culture; The delivery of the Group's strategy is of fundamental importance to its future * Continued focus on cash management; and performance. COVID-19 impact: low. * Effective communication with stakeholders. The Group believes that COVID-19 has affected its short-term performance, rather than the longer-term delivery of its strategy. ------------------------------------- ------------------------------------------------------------- Brexit The UK left the EU on 31 The Group has identified January 2020, with a transition potential risks relating period currently running to, for example, the to 31 December 2020. Currently, supply chain, the the UK's long-term relationship workforce and the with the EU remains unclear. supply and cost of materials and has set up contingency plans in respect of these risks. The Group keeps these plans under review, in the light of political developments. In particular, the Group continues to work with its supply chain to develop plans to ensure continuity of potentially critical supplies and has developed plans with respect to those members of its workforce who are nationals of EU member states and wish to continue to work in the UK. ------------------------------------- ------------------------------------------------------------- COVID-19 The COVID-19 pandemic has As the UK continues had, and may continue to its exit from lockdown, have, a material and adverse Government restrictions effect on the Group's results and requirements are of operations and a number closely monitored of the Group's stakeholders, so as to ensure continued including its employees, compliance. Particular clients and supply chain. areas of focus include: The extent of the effect Compliance with the of COVID-19 on the Group Group's site operating and its stakeholders depends procedures; on a range of factors, including Ensuring the continued its effect on the wider supply of materials economy in general, measures and availability of taken by Government in response the supply chain, to it, including the proposed wherever possible; increase in UK infrastructure and investment, and the effects Supporting the Group's of any re-occurrence of workforce to continue the pandemic. to operate as effectively as possible in the circumstances. ------------------------------------- ------------------------------------------------------------- Emerging The Group has identified Risks the following as principal, emerging risks: The continued impact of COVID-19 on the Group's sites and operations; The UK's recession, following COVID-19; and The operational, financial and commercial effects of climate change disruption on the Group. ------------------------------------- -------------------------------------------------------------
Related party transactions
Identity of related parties
The Group has a related party relationship with its, key management personnel, the pension schemes in which its employees participate and the joint ventures listed below.
Transactions with key management personnel
The Group's key management personnel are the Company's Executive and the Non-executive Directors. Transactions with these individuals are identified in the Directors' Remuneration Report on pages 101 to 121 of the Annual Report.
In addition to their salaries, the Group also provides non-cash benefits to the Directors and contributes to their pension arrangements as disclosed on page 113 of the Annual Report. Key management personnel also participate in the Group's share option programme (see note 28 of the consolidated financial statements).
Key management personnel compensation comprises:
2020 2019 GBPm GBPm ------------------------------------------------------ ----- ----- Emoluments as analysed in the Directors' Remuneration Report 2.2 5.2 Employer's national insurance contributions 0.3 0.6 ------------------------------------------------------ ----- ----- Total short-term employment benefits 2.5 5.8 Share-based payment charge 1.8 0.7 ------------------------------------------------------ ----- ----- 4.3 6.5 ------------------------------------------------------ ----- -----
Transactions with pension schemes
Details of transactions between the Group and pension schemes in which its employees participate are detailed in note 9 of the consolidated financial statements.
Transactions with joint ventures
2020 2019 GBPm GBPm ------------------------------------ ----- ----- Construction services and materials 237.1 278.2 Staff and associated costs 10.2 10.0 Management services 13.4 16.0 Interest on loans to joint ventures 0.8 0.6 Plant hire 1.4 1.3 ------------------------------------ ----- ----- 262.9 306.1 ------------------------------------ ----- -----
Equity loans due from joint ventures are analysed below:
2020 2019(1) GBPm GBPm -------------------------------------- ----- ------- Kier Cross Keys Holdco 1 LLP 35.0 35.0 Kier Community Living Topco 1 LLP 32.1 32.1 Kier Trade City Holdco 1 LLP 17.6 12.7 Solum Regeneration (Twickenham) LLP 14.5 14.2 Kier (Newcastle) Investment Ltd 10.1 10.1 Kier (Southampton) Investment Limited 10.0 10.0 Kier Richmond Holdings Limited 9.9 9.9 Watford Health Campus Partnership LLP 9.7 7.0 Solum Regeneration (Bishops) LLP 7.2 5.0 Kier Cornwall Street Holdings 1 LLP 6.5 6.5 Kier Cornwall Street Holdings 2 LLP 6.5 6.5 Solum Regeneration (Guildford) LLP 6.2 3.4 50 Bothwell Street Holdco 1 LLP 5.6 5.2 Easingwold Holdco 1 LLP 4.7 2.9 Stokesley Holdco 1 LLP 4.2 2.7 Driffield Holdco 1 LLP 2.5 2.5 Winsford Holdings 1 LLP 2.4 1.2 Solum Regeneration (Kingswood) LLP 2.2 0.1 Solum Regeneration (Epsom) LP 1.4 5.3 Solum Regeneration (Redhill) LLP 1.4 1.2 Solum Regeneration (Maidstone) LLP 0.7 0.6 Solum Regeneration (Surbiton) LLP 0.3 0.1 Solum Regeneration Holding 1 LLP 0.2 0.2 Solum Regeneration Holding 2 LLP 0.2 0.2 Solum Regeneration (Walthamstow) LLP 0.1 2.0 Solum Regeneration (Haywards) LLP 0.1 0.4 KCK Peterborough Holdco 1 LLP - 4.8 Strawberry Percy Holdings 1 LLP - 1.6 Strawberry Percy Holdings 2 LLP - 1.6 Tri-link 140 Holdings 1 LLP - 1.4 Notaro Kier LLP - 1.3 Black Rock Holdco 1 LLP - 1.2 Kier Sovereign LLP - 0.8 191.3 189.7 -------------------------------------- ----- -------
1 The comparative figure for Kier Cross Keys Holdco 1 LLP has been restated by GBP3.9m from GBP38.9m to GBP35.0m to reflect the equity loan provided to the joint venture by Kier only.
2
Trading balances due from joint ventures are analysed below:
2020 2019 GBPm GBPm ----------------------------------------- ----- ----- Kier Community Living LLP 12.7 4.2 Kier Cross Keys Dev LLP 0.8 6.0 Stokesley Devco LLP 0.6 3.3 Hackney Schools for the Future 2 Limited 0.6 - Easingwold Devco LLP 0.4 0.5 Kier (Southampton) Investment Limited 0.3 - Driffield Devco LLP 0.2 0.4 Black Rock Devco LLP 0.1 - Dragon Lane LLP 0.1 - Kier Trade City LLP 0.1 - Tri-Link 140 LLP - 3.8 Hackney Schools for the Future Limited - 1.4 Winsford Devco LLP - 0.8 Kier Richmond Limited - 0.3 Team Van Oord Limited - 0.1 KCK Peterborough Devco LLP - 0.1 15.9 20.9 ----------------------------------------- ----- -----
Directors' responsibility statements
The Directors consider that the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group and Company's position and performance, business model and strategy.
Each of the Directors, whose names and functions are listed in the Annual Report confirm that, to the best of their knowledge:
-- the Company financial statements, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 101 'Reduced Disclosure Framework', and applicable law), give a true and fair view of the assets, liabilities, financial position and loss of the Company;
-- the Group financial statements, which have been prepared in accordance with IFRSs as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and loss of the Group;
-- the Directors' Report in the Annual Report includes a fair review of the development and performance of the business and the position of the Group and Company, together with a description of the principal risks and uncertainties that it faces; and
-- so far as the Directors are aware, there is no relevant audit information of which the Group and Company's auditors are unaware; and they have taken all the steps that they ought to have taken as a Director in order to make themselves aware of any relevant audit information and to establish that the Group and Company's auditors are aware of that information.
Ends.
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