Market report: Morgan Sindall constructs a winning formula with ‘outstanding’ numbers

Construction group Morgan Sindall built on its recent share price rally as the City lapped up annual results dubbed “outstanding” by Liberum.

Revenues rose 7% to £2.56 billion last year, and adjusted pre-tax profits soared 32% to £45.3 million.

The firm swung to a profit from a £15 million loss last year, which was caused by exceptional items involving two legacy contracts for the Ministry of Defence.

The company rewarded investors by raising the total dividend 21% to 35p a share.

Analysts at Liberum added that they were encouraged by the recent contract win to build the first phase of the High Speed 2 rail network and highlighted ambitious margin targets revealed for the first time.

They think these mean profits can nearly double from last year’s figure.

Shares took a pounding after the vote for Brexit, but have since recovered to above pre-referendum levels. They were up 50.96p, or 6%, today to 955.96p.

A string of strong blue-chip results failed to inject life into the FTSE 100, which was off 2.90 points at 7299.35 as a number of big heavyweights went ex-dividend.

Among them were mining giant Rio Tinto, which was down 132p, or 3.6%, at 3476p, and airline easyJet, which lost 47p, or almost 5%, to 927p.

RELX, 2p weaker at 1477p, shed early gains despite its annual results beating analyst forecasts.

Revenues at the business — formerly known as Reed Elsevier — were up 15% at £6.9 billion, about £100 million more than the City’s best guesses, and adjusted operating profits were also better than expected, up 16% to £2.1 billion.

Investors reversed out of car parts-to-bikes retailer Halfords, which dived 14.7p to 342.1p as Peel Hunt cut its rating to Sell, concerned that cyclists are replacing their bikes less frequently.

It also argued that higher oil prices, which mean more expensive petrol, translates to fewer miles driven, which is bad news for its motoring business.

AO World founder John Roberts appeared to heed the advice of his own company whose slogan is “AO, let’s go”, as he stepped down as chief executive.