Keller Group (LSE:KLR), the world's largest geotechnical specialist contractor, reported revenue of £1,608m for the six months ended 30 June, up 11.1% on a constant currency basis against the same period in 2025.
Underlying operating profit rose 17.1% to £117.9m, lifting the operating margin to 7.3% from 7% a year earlier. Underlying diluted earnings per share climbed 22.4% to 120.1p, helped by earnings growth and the Group's share buyback programme.
North America, Keller's largest division, delivered record revenue of £984.4m, up 16.7% at constant currency, with operating profit up 17.7% to £93.8m and margins held at 9.5%, driven by infrastructure and data centre demand. Europe and Middle East operating profit grew 28% to £19.2m despite lower revenue, while Asia-Pacific revenue rose 22.8% to £227.5m though margins slipped to 6.1% from 7.7% on Australian market pressures.
Net debt stood at £15.9m at the half-year, down from £61.5m a year earlier, with leverage of 0.1x, well below the Group's 0.5x-1.5x target range. Keller bought back around £35m of shares since launching a £100m programme on 30 March, and raised its interim dividend 57% to 28.7p under its enhanced dividend policy.
"We are building further momentum, with a record order book of £1.9bn demonstrating the benefits of our geographic and sector diversification", said chief executive James Wroath.
The order book reached £1.9bn, up from £1.6bn a year earlier, boosted by a multi-year I-40 highway remediation contract that will unwind over two to three years rather than the usual six months. Management said it expects full-year performance in line with recently upgraded market expectations, with a Capital Markets Day scheduled for 14 October in London.
News Intelligence what this means for the company
Keller delivered 17% underlying operating profit growth in H1 2026 on 11% revenue growth, with North America hitting record volumes and margins holding firm at 9.5% despite infrastructure and data-centre demand. The company has swung to net debt of just £15.9m (0.1x leverage, well below its 0.5x–1.5x target), raised its interim dividend 57%, and holds a record £1.9bn order book — though notably inflated by a multi-year I-40 highway contract that will unwind over two to three years rather than the typical six-month cycle, so near-term revenue visibility is strong but the order book's headline size masks a lumpy revenue profile.
Margin expansion (7.3% from 7.0%) and North America's sustained 9.5% operating margin show pricing power offsetting cost inflation. The shift to net cash and aggressive capital return (£35m of a £100m buyback programme deployed, dividend up 57%) signals management confidence in cash generation, though Asia-Pacific margin compression (6.1% from 7.7%) and reliance on a single large contract for order book growth warrant monitoring.
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