Morgan Sindall has reported it is on track to deliver year-end profits ahead of schedule thanks to strong half-year performances from its Construction & Infrastructure and Fit Out businesses.

In a trading update, the company revealed its committed order book as of 30 September 2017 was up 5% to £3.8 billion, while its development pipeline has risen 2% compared to last year to £3.3bn.

However, an ongoing focus on operational delivery and contract selectivity has helped to further improve performance in the Construction & Infrastructure division.

Steve Crummett, Group Finance Director, said: "Construction's recovery has continued and accelerated, with considerable progress towards achieving its medium term margin target of 2% expected in the second half. Infrastructure has performed as expected and its mix of work in the second half should drive the expected margin increase, ahead of its first half result."

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"Fit Out has achieved further margin progression ahead of its strong first half result and, based on its visible workload for the rest of the year together with its current contract delivery performance, very strong second half margin and profit is expected. Its order book as at 30 September 2017 was £540m, up 16% from the year end (down 5% from the half year) of which £333m is for 2018, thereby providing a strong underpin to next year's trading."

However, the Property Services business is expected to take a £1m hit due to costs associated with restructuring and exiting underperforming contracts, as well as exiting its legacy insurance services business to better serve its core local authority customer base.

Looking ahead, the Group is expected to show average daily net cash for the year in excess of £100m, up from previous guidance as set out at the time of the half year results of average daily net cash being not less than £75m.

(LM)