StockMarketWire.com - Keller Group said Monday profits slumped owing to a rise in costs related to asset write-downs, redundancy costs and reorganisation charges. The company also offered up a dour outlook for 2019, estimating flat revenue growth.

For the year ended 31 December, statutory profit before tax fell 92% to £8.4m, while revenue rose 7% to £2.2bn.

Profits were weighed down by pre-tax non-underlying debits of £72.1m, compared with a credits 11.9m a year earlier, largely due to exceptional restructuring charge of approximately £61.4m, which remained in line with previous guidance.

Underlying profit before tax, which excluded the impact of pre-tax non-underlying debits, fell 16% to £80.5m.

Underlying operating profit rose 11% to £96.6m.

The 9% increase from the acquisition of Moretrench, which was performing ahead of plan, was more than offset by FX headwinds of 3% and an organic reduction of 17% resulting from the previously announced completion of the large projects in EMEA, raw material cost increases in Suncoast and the significant losses in ASEAN and Waterway in the second half of the year, the company said.

Net debt of £286.2m was better than consensus, the company added.

The company proposed a final dividend of 23.9p, giving a total dividend of 35.9p for the year, an increase of 5% from the prior year.

Looking ahead to the current year, the company said it expects revenue to be broadly flat with an improvement in margin and a good recovery in profit.

'2018 results were deeply unsatisfactory with an 11% profit decline, as a result of which we have acted firmly in restructuring four of our business units,' said Alain Michaelis, Chief Executive Officer.

'In addition we have continued to build the capability of the group, with the successful acquisition and integration of Moretrench in the US a notable highlight. The internal improvement measures, coupled with a stable market outlook, a healthy order book and Keller's leading position in the industry, give us confidence in the outlook for 2019.'

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