Kier Group Achieves Net Cash Milestone with Record £11.6bn Order Book in Trading Update

Kier’s first-half trading: guidance intact, cash better, momentum building

Kier Group’s latest trading update is steady-as-she-goes on profits and strong on cash. Management says first-half and full-year performance remain in line with expectations, with no change to guidance. The standout is cash: an average month-end net cash position of c.£15m in the first half, compared with £(38)m net debt in HY25. Kier also expects a period-end net cash position “substantially above” the prior year’s £58m.

That matters. Moving from average net debt to average net cash is a meaningful inflection for a contractor, signalling tighter working capital discipline and a healthier balance sheet going into the second half. We get the full numbers on 3 March 2026.

Record order book of c.£11.6bn and 94% of FY26 revenue secured

The order book at 31 December 2025 stands at c.£11.6bn, up from £11.0bn a year earlier. An order book is the contracted pipeline of future work – so a bigger one gives more visibility. Kier says 94% of FY26 Group revenue is estimated to be secured, which is high for the sector.

On the face of it, that’s a strong platform: more work locked in, less uncertainty about the top line. The open question (not disclosed here) is the margin profile of that work – the crucial determinant of profit quality in a fixed-price environment.

New contract wins across infrastructure and construction

Kier continues to land work in regulated and government-backed markets, which tend to be more resilient through cycles. Highlights called out in the update:

• Infrastructure Services:
  • Appointed to a Tier 1 collaborative framework with British Airways for its Better Buildings programme, initially at Heathrow, with potential to extend to other airports.
  • Two Early Contractor Involvement (ECI) contracts worth £44m with Southern Water under its £3.1bn AMP8 Strategic Delivery Partner Framework. ECI brings contractors in early to de-risk design and cost before full delivery.
  • A two-year extension on the Minor Civils Framework at Hinkley Point C.
• Construction:
  • Two education projects worth a total of c.£112m.
  • Government Property Agency Hub in Darlington worth £85.5m.

Property progress on industrial and logistics

• Planning permission secured at Sharston Industrial Area in Manchester for a four-acre site to deliver 98,000 sq ft of business space.
• Practical completion achieved on a 126,106 sq ft Logistics City development in Milton Keynes.

Property activity is selective, but these are sensible industrial and logistics schemes aligned with occupier demand. No financial returns are disclosed at this stage.

Why the net cash milestone is a big deal

Contractors live or die by working capital. Cash tends to ebb and flow through the month as bills are paid and certifications are received. Averaging c.£15m of net cash across month-ends in the half – versus average net debt in the prior year – signals sharper project delivery and cash collection.

It should make the business more resilient to shocks and reduce reliance on costly facilities. The period-end net cash is expected to be “substantially above” last year’s £58m. We don’t have the exact figure yet, but directionally, that’s positive.

Infrastructure strategy tailwinds and sector positioning

Kier highlights that UK government investment in transport, education, healthcare, justice, defence, water and nuclear features strongly in the 10 Year Infrastructure Strategy. For a top-tier supplier across these areas – notably in regulated industries like water – that pipeline offers long-duration work and potential growth. Execution and pricing discipline remain the watchwords.

Water in particular looks important. The Southern Water AMP8 wins are early evidence of activity picking up in the new regulatory period. If that broadens, Kier’s integrated capability could be well placed.

New structure and leadership: setting up for the next phase

Kier has combined its Transportation and Natural Resources, Nuclear & Networks divisions into a single Infrastructure division. Consolidating road, rail, aviation, water, energy and environment under one roof should simplify delivery and cross-sell capabilities. The new division is led by Joe Incutti, formerly Group Managing Director for Kier Transportation.

Two senior appointments arrived in January: Tom Hinton, previously interim CEO at Wincanton, as CFO; and Martin Staehr, previously a Director at Laing O’Rourke, as Group Managing Director for Construction. Fresh finance leadership and a seasoned construction operator are timely, given the order book scale-up.

Key numbers at a glance

Metric	Update
Order book (31 Dec 2025)	c.£11.6bn (31 Dec 2024: £11.0bn)
FY26 revenue secured	94%
Average month-end net cash (H1 FY26)	c.£15m (HY25: £(38)m net debt)
Period-end net cash (31 Dec 2025)	Expected substantially above HY25: £58m
Selected awards	Southern Water ECI £44m; GPA Hub Darlington £85.5m; two education projects c.£112m

What to watch into the 3 March results

• Margins and profitability: Not disclosed in this update. With guidance unchanged, I’ll look for operating margin trends and any split by division.
• Cash conversion: Strong H1 cash is encouraging; the cadence of cash through H2 will be key to the full-year position.
• Order book quality: 94% revenue secured is high. I’ll want detail on risk-sharing mechanisms and inflation protection in major contracts.
• Infrastructure division benefits: Any early evidence of improved win rates, delivery efficiency or overhead savings from the reorganisation.
• Water and nuclear pipeline: Further awards under AMP8 and progress at Hinkley Point C could underpin medium-term growth.

My take: solid progress, better cash, opportunity-rich pipeline

This is a clean update: guidance intact, record order book, and a genuine cash step-up. The mix of awards skewed to regulated and government-backed markets supports visibility. The new Infrastructure division and leadership hires suggest Kier is organising itself for the next leg of growth.

Balancing that, today’s statement is light on profit detail – margins are not disclosed, and we do not get an exact period-end cash number yet. That is fine for a mid-period trading update, but the March results will need to confirm that the higher order book is translating into disciplined, profitable growth.

Overall, the tone is confident and the numbers on work-winning and cash are moving the right way. For retail investors, the near-term catalyst is 3 March 2026. Between now and then, execution quality and cash discipline remain the two metrics that matter most.