Jarvis' £55m deal

SHARES in Jarvis rose almost 10 per cent after the rail network services group said it won a multi-million pound railway infrastructure contract.
By The Newsroom
Published 14th Jan 2010, 21:02 BST
Updated 14th Jan 2010, 21:02 BST

The York-based company said the initial phase of the contract, awarded by an as yet unnamed party, is worth around 55m, with most of the work to take place in its financial year starting in April. It said a second optional phase is worth an extra 36m and may begin in 2011. Shares gained 1.5p to close at 17.5p.

"The contract is good news for sentiment after a very challenging 12 months for Jarvis," said analyst Andrew Nussey at house brokers KBC Peel Hunt. "We have Jarvis down for group revenues of 234m for fiscal 2011 and we anticipate some growth within that, helped by this contract."

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Jarvis said it would give more detail about the contract imminently.

Jarvis, which earns the bulk of its revenues from Network Rail, has been struggling through a fallow period after the government-backed body decided to defer spending on a 4bn portion of its track renewal programme.

Its chief executive, Stuart Laird, said recently it is trying to offset this by winning new customers and contracts.

Related topics:YorkNetwork Rail