Interserve, the international services, maintenance and building group, has announced its annual results for the year ended 31 December 2009.

The Group, which saw a 5.9% increase in revenue – up £1,906.8M in 2009 from £1,800M in 2008, said it had made good progress in 2009. The dividend was up 2.9 per cent to 17.5 pence per share, while headline total operating profit of £85.7 million rose from £84.2 million in 2008.

Interserve also has strong revenue visibility, winning work with a whole-life value of more than £2 billion in 2009, and further contract awards in 2010 to date of c. £500 million. These include two Thames Water contract  wins totalling £60 million to construct new facilities and upgrade existing works at its  Riverside sludge digestion plant. A reduction in net debt reduced by 65.8 per cent to £37.3 million has also contributed to the Group’s strong financial position.

Water sector expected to provide steady work throughput in coming years

Interserve said that in infrastructure, it had continued to develop strong relationships with the water utilities, the Highways Agency and the Environment Agency. The company highlighted its progress made in the water infrastructure sector as of “particular note”, with successes in securing places on the AMP5 framework contracts with United Utilities and South West Water, and nearing completion on the Thames Gateway desalination plant for Thames Water. Interserve said it expects the water sector to provide a steady throughput of work over the coming years.

Strong platform for long-term growth

Chief Executive Adrian Ringrose commented,

“Interserve made good progress during difficult conditions in 2009. Whilst the Group is not immune to the current economic challenges, it benefits from a solid and balanced UK position, continued opportunities internationally, good revenue visibility and a strong balance sheet. Given the risks in the external environment, 2010 will be a challenging year, particularly in the first half. However, we are focused on taking advantage of the opportunities for renewed growth, as and when our markets recover. Our confidence in the Group’s future prospects is reflected in the Board’s recommendation of the continuation of our progressive dividend policy.”

The company said that its UK construction business had a healthy order book for 2010 and expected it to maintain its solid 2009 performance, describing activity levels as remaining solid in the public and utilities sectors.

Chairman Lord Blackwell said:

“In the UK, prospects for increased outsourcing, a healthy UK construction order book and demand for social infrastructure should provide growing opportunities, where our complementary range of business capabilities means we are well placed to help customers deliver value-for-money services. We are continuing to take concerted action to reduce our cost base in a number of our newer public sector Facilities Management contracts where trading has been weaker than anticipated; this, together with pressure on discretionary spending, will have an impact on this division’s results in the short term”.

Based in the UK, Interserve has revenues of £1.9 billion and a workforce of over 50,000 people worldwide.