Morgan Sindall shares rise on strong trading update

Diverse development and construction group Morgan Sindall said business is improving and it is on track to meet expectations for the current year.

Morgan Sindall's group of companies include developer Muse, social housebuilder Lovell, infrastructure and construction division Morgan Sindall and fit-out firm Overbury. The firms have offices Liverpool, Manchester, Salford Quays and Warrington.

The company said in a statement to the London Stock Exchange today: "The group's financial position remains strong, with net cash at the half year expected to be more than £100m and average cash for the six months significantly above market expectations. The group's forward order book currently stands at £3.5bn, compared with £3.2bn at the start of the year. We have had a positive first half of 2010 and with our broad sector spread we remain well positioned to face the challenges ahead and to benefit from opportunities as they present themselves."

Shares in Morgan Sindall were up nearly 5% at 515p by mid-morning Friday, valuing the group at £211.5m.

The statement continued: "The group's positive start to the year has continued and we remain on track to meet our expectations for the current year with improvements in underlying trading expected to offset the estimated £2m net cost of the integration of the construction and infrastructure services divisions in the current year."

Notable highlights in the breakdown of the subsidiaries' performance were Overbury's business is picking up, running 10% ahead by revenue on last year and Muse is predicted to turn a modest profit this year despite the subdued development market. Lovell this week acquired maintenance firm Powerminster Gleeson Services.