Kier Group shares slump in wake of shock profit alert

Kier, the construction firm behind a string of Scottish projects, has issued a profit alert, with bosses revealing that earnings are expected to be £25 million lower than expected.

Earlier this year, Kier Construction Scotland completed the multi-million-pound overhaul of two historic buildings for the University of Edinburgh, including refurbishment of the grade A-listed Edinburgh College of Art. Picture: Paul Zanre

In an update on trading, the group said the highways, utilities, housing maintenance and buildings divisions will be particularly affected and revenues will be flat at some £2.5 billion. Shares in Kier Group were down 29 per cent in early trading on Monday.

New chief executive Andrew Davies, who is conducting a review into the business, also revealed the costs to its “future proofing” project will more than double – costing £29m compared with £14m originally earmarked.

Davies joined the firm in March and drew up plans for a major overhaul, after attempts by previous management to raise £250m from shareholders to strengthen the balance sheet failed. The review is expected to be completed by the end of July.

Earlier this year, Kier Construction Scotland completed the multi-million-pound overhaul of two historic buildings for the University of Edinburgh.

The firm undertook the £14m refurbishment of the grade A-listed Edinburgh College of Art.

Together with performing essential upgrading of the building’s fabric and internal systems, it carried out a series of improvements, including bringing a previously unused courtyard on the west side of the main building into use.

The second transformation involved the £7.7m refurbishment of the grade B-listed Murchison House.

Located on the university’s King’s Buildings Campus, the former British Geological Survey building has undergone an extensive fit-out to transform it into a "dynamic, multi-functional" building.