(Reuters) - British builder Morgan Sindall (MGNS.L) raised its 2017 earnings forecast for the second time in four months on Wednesday, citing better margins in construction and its office installation and refurbishment business.
It now expects its average daily net cash position for the year to Dec. 31 to be in excess of 100 million pounds ($133 million), up from its July guidance of not less than 75 million pounds.
Morgan Sindall’s upbeat view contrasts with that of sector peers, whose results have been hit over the past twelve months as mounting costs have turned some older contracts unprofitable.
Carillion (CLL.L), Interserve (IRV.L), Mitie (MTO.L) and Capita (CPI.L) have all issued profit warnings, as a slowdown in new contract awards since Britain’s 2016 vote to leave the European Union has added to the companies’ problems.
On Tuesday, Morgan Sindall, which has in recent years been more selective on which contracts it bids for, said it was on track to deliver a full-year performance slightly ahead of its previous expectations.
It did not give a figure, but had reported a 2016 pretax profit of 43.9 million pounds.
Liberum analysts raised their 2017 pretax profit estimate to 65.5 million pounds from 63.5 million pounds.
“While others in the sector have recently frightened and scared investors, this Halloween Morgan Sindall comes knocking with treats rather than tricks,” Jefferies analysts wrote.
Morgan Sindall’s shares, which have more than doubled in value over the past 12 months, were up 3 percent at 1,489 pence at 0827 GMT.
($1 = 0.7524 pounds)
Reporting by Esha Vaish in Bengaluru; Editing by Jason Neely and Mark Potter