Galliford Try (LON:GFRD) reported another period of profit and margin growth in its half-year results for the six months ended December 31, 2025, as management highlighted supportive market conditions across UK social and economic infrastructure and continued progress against the group’s 2030 strategy.
Profit growth and higher margins on broadly flat revenue
Chief Executive Bill Hocking said the group is in “really good shape” with a strong order book, a robust balance sheet, and supportive end markets. Revenue rose 1.3% year over year to £934.9 million (up £12 million), with Chief Financial Officer Kris Hampson reiterating that the company had guided to relatively flat revenue in FY2026 as it transitions from AMP7 to AMP8 in water, alongside further margin expansion.
The group’s adjusted divisional operating margin improved to 3.2% from 2.7% a year earlier and 3.0% at FY2025, reflecting what management described as quality delivery from a risk-managed order book and improved commercial terms on new frameworks. Adjusted basic earnings per share increased 18.5% to 18.6 pence, supporting an interim dividend of 6.5 pence per share, up 18.2% year over year.
Building and infrastructure deliver broad-based progress
In Building, revenue rose 2.0% to £476.5 million, driven by demand in sectors including defense, custodial, education, and the company’s specialist facilities management business. Adjusted operating profit increased 19.2% to £14.9 million, with margins improving 45 basis points to 3.1%. The Building order book increased 5.4% to £2.4 billion, which the company said was driven by defense and custodial work. Hampson also noted a win on an affordable housing framework with The Hyde Group across East, South, and London regions.
In Infrastructure, revenue increased 0.6% to £454.2 million. Management attributed performance to the expected AMP transition and a robust highways contribution, with a dry summer and autumn aiding progress on major highways projects. Adjusted operating profit in Infrastructure rose 23.6% to £15.2 million, while the margin increased 62 basis points to a record 3.3%. Management cited quality first-time delivery, progress on early AMP8 design work, improved framework commercial terms, and progress on major roads projects as key drivers.
The Infrastructure order book rose to £1.7 billion, and the company said 87% of FY2027 revenue is secured in the division. Hampson said the business is positioned for the AMP8 growth period, and also referenced an extension of the highways business into civil engineering elements of the National Grid HVDC framework and Sizewell C access roads.
Cash position, shareholder returns, and balance sheet strength
Galliford Try reported period-end cash of £211.7 million, and average month-end cash of £189.9 million, up 6.3% from June 2025 and up 7.7% from the prior half-year period. The group reiterated that it has no bank debt, no pension liabilities, and that its revolving credit facility remains undrawn.
Cash from operating activities was £24 million (including IFRS 16 leases). The company reported a working capital outflow of nearly £30 million, which management described as seasonal and slightly better than the prior period’s £33 million outflow. Shareholder returns in the half, through the share buyback and the prior-year final dividend, totaled £20.6 million.
Net positive interest income rose to £3.1 million from £1.8 million a year ago, which management attributed to improved cash interest management on higher average cash balances. Hampson also said the company continues to pay its supply chain proactively, with an average of 29 days to pay.
Since the year end, the company paid its final dividend of 13.5 pence per share and progressed a third share buyback announced in September 2025, with around £9 million of the £10 million program transacted. The company expects to complete that buyback by the end of the current financial year. Hampson said dividends remain covered by earnings per share at 1.8 times under the policy implemented in 2023.
Acquisition announced in fire protection; specialist growth remains a focus
Galliford Try announced the acquisition of Nene Valley Fire & Acoustics Ltd for around £10 million. Management said the business will join its Asset Intelligence and Oak Fire Protection operations, adds scale in passive and active fire protection, and is expected to be adjusted operating margin accretive in the first year.
Hocking described the fire protection market as “very fragmented,” which he said creates opportunity for growth through increased critical mass, geographic expansion, and cross-selling into Galliford Try’s framework and client base. He also indicated there could be scope for further consolidation through future bolt-on acquisitions.
Order book visibility and strategy commentary: water, education, affordable housing, and PPP
The group’s total order book stood at £4.1 billion, up £200 million on the same period last year. Management said 98% of work is secured for the current financial year and 80% of FY2027 revenue is already secured, providing what Hocking called a “continuous power wave of work.” The company emphasized that 99% of the order book comes through negotiated routes such as two-stage, target cost reimbursable, or directly negotiated work, reflecting a focus on frameworks and collaborative procurement.
In education, Hocking said the company typically builds 20–25 schools at any one time and has secured a position on the renewed Department for Education Estates Framework for large schemes across England and smaller schemes in the Midlands and the South. He said the renewed framework is larger in geography and longer in duration, and noted that the company has already been allocated two schools with a combined value of £94 million.
On water, management described the AMP7-to-AMP8 transition as typical, with a slower first half and increasing momentum into the second half, and “very strong” conditions expected in 2027 and 2028. Hampson said in response to analyst questions that the infrastructure order book had increased and that orders appeared to be coming through more in recent weeks as AMP8 design work ramps up.
Affordable housing was described as running about 18 months behind management’s earlier expectations due to factors including planning, funding, and the Building Safety Act. However, Hocking said the market is starting to show signs of progress, and that the company expects to sign its first affordable housing contract “imminently,” with “a few more quite shortly thereafter.” He reiterated the ambition of reaching around £250 million per annum in affordable housing by 2030 from a standing start, while acknowledging the trajectory will depend on market recovery.
In Q&A, Hocking also said the company’s entry into affordable housing is initially contracting-led and “not going to consume cash,” with balance sheet involvement potentially increasing later. He added that the group’s investments team—historically a PPP/PFI capability—could support front-end work in private rental sector projects and potentially affordable housing partnerships over time.
On investments, Hocking said the UK government has been discussing using “some form of PPP” for healthcare centers in England, which he described as encouraging and aligned with the company’s capabilities, while noting schools were not currently part of that discussion.
Closing the call, Hocking reiterated confidence in the outlook through 2030, citing strong long-term demand from government and regulated utilities, an “excellent balance sheet,” and the expectation that full-year results will reflect that outlook.
About Galliford Try (LON:GFRD)
Galliford Try is one of the UK’s leading construction groups, working to improve the UK’s built environment, delivering positive, lasting change for the communities we work in on behalf of our clients.
Our business operates mainly under the Galliford Try and Morrison Construction brands, focusing on areas where we have core and proven strengths, namely in Building, Highways and Environment. We see long-term growth and appropriate margins in these markets.
Our company is founded on our values of excellence, passion, integrity and collaboration, and our vision is to be a people-orientated, progressive business, driven by our values to deliver lasting change for our stakeholders and the communities we work in.
