Carillion Lifts Dividend by 2% to Yield 5.4%

LONDON -- he shares of Carillion  (LSE: CLLN  ) climbed 1 pence to 318 pence during early London trade this morning after the construction group lifted its annual dividend by 2%.

The FTSE 250 mid-cap said its annual payout had been raised from 16.9 pence to 17.25 pence per share.

The dividend news accompanied full-year results that showed revenue falling 13% to £4.4 billion and underlying profit before tax sliding 4% to £215 million.

The shortfall was blamed on a "rescaling" of the group's U.K. construction activities and the "timing" of overseas contract opportunities.

The figures also showed net borrowings advancing by more than £100 million to £155 million and the firm's pension deficit growing by £40 million to £270 million. Carillion's total order book fell by £1 billion to £18 billion, too.

Philip Rogerson, Carillion's chairman, said: "Carillion has continued to deliver a robust performance, with underlying earnings per share slightly ahead of the market consensus forecast. Having rescaled our U.K. construction activities, we have also further improved the risk profile and the overall quality of our business."

Mr Rogerson also reckoned market conditions would "remain challenging" during 2013.

But he claimed "a resilient business model, a strong order book and a substantial pipeline of contract opportunities" could help the business increase aggregate revenues from the Middle East and Canada to about £2 billion by 2015. Sales from those areas came to £1.1 billion during 2012.

Mr Rogerson also calculated likely contracts for 2013 had already secured 75% of anticipated turnover for 2013.

Based on today's results, Carillion is valued at less than 9 times profits and offers a 5.4% dividend income.

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