Kier and Cross Keys form East of England jv

Kier has launched a joint venture with housing association and care home provider Cross Keys Homes Developments to build out schemes in the East of England. Kier will transfer part of its landbank and residential developments in the East of England into the jv, valued at around  £97m. It will also contribute £4m of equity. It will then receive a cash payment from Cross Keys of up to £64m, with a 90:10 split in economic ownership, with each party having equal voting rights. Kier said the deal would release funds for reinvestment in other parts of its business in line with its 15% return on capital employed hurdle. Haydn Mursell, chief executive of Kier, said: “The joint venture represents a strategic milestone for Kier Residential. This transaction enables us to accelerate our strategy to recycle the capital employed in the Kier private landbank to drive the future growth of the group and improve our overall ROCE.” Kier also released it half-year results this morning and announced a chairman designate, with Philip Cox, deputy chair of Drax Group, to take over from Phil White in mid-November. In the six months to the end of 2016, it reported a 1% decline in revenue to £2bn, but a 4% increase in profit from its operations to £56.5m. Profit before tax increased to £46.3m. Six months ended 31 December 2016 Six months ended 31 December 20151 Change (%) Revenue £2,004m £2,016m -1 Profit from operations £56.5m £54.4m 4 Operating margin 2.80% 2.70% Profit before tax £46.3m £41.5m 12 Basic earnings per share 38.9p 34.9p 11 Interim dividend per share 22.5p 21.5p 5 Net debt £179m £174m 3 Six months ended 31 December 2016 Six months ended 31 December 2015 Change % Group revenue £1,996m £1,973m 1 Profit from operations £47.0m £18.9m 149 Profit before tax £34.9m £4.3m 712 Basic earnings per share 39.9p 7.9p 405 To send feedback, e-mail alex.peace@egi.co.uk or tweet @egalexpeace or @estatesgazette