Providing an update on trading and an outlook for the 2021 financial year, the group said its strong cash position has also further improved and it is now expected that the average daily net cash for the full year will be in excess of £180 million.

In its divisions, infrastructure is continuing to trade strongly, with operational delivery and work mix driving further margin growth, while the construction arm has had a strong start to the year with its secured order book at the end of March up 10% from the year end position and its ongoing focus on contract selectivity and risk management provides the basis for continued further improvement through the year.

The fit out division has had a very strong trading period and its secured order book at the end of March was 18% higher than at the year end. In addition, it has in excess of £400m of work currently at preferred bidder stage. Taken together, fit out is expected to deliver a result for the year which is materially ahead of its medium-term target.

Volume in property services has held up well despite lower than expected planned maintenance activity, with its margin expected to improve as the year progresses, while partnership housing has continued to see high levels of market demand, which together with ongoing improvements in operational delivery, is driving good margin and profit growth.

In February, Morgan Sindall revealed a £27.8m drop in pre-tax profit to £60.8m due to the impact of the COVID-19 pandemic and said at the time it expected profit to be materially ahead of its previous expectations and slightly ahead of that delivered in 2019.

Today’s update provided an upgraded set of expectations.

“On the basis of the performance to date, the group’s operational delivery capabilities and the current visibility of future workload for delivery in the remainder of the year, the group is now on track to deliver a full year performance which is significantly ahead of its previous expectations,” the company said.

The average daily net cash from 1 January to 20 April was £288m (of which £68m was held in jointly controlled operations or held for future payment to designated suppliers). This represented an increase of £154m over the average for same period last year.

Based upon this and current forecasts to the year end, the average daily net cash for the full year is now expected to be in excess of £180m (FY 2020: £181m), significantly ahead of previous guidance.

Chief executive John Morgan said: “Since the start of the year, the positive momentum across the group has continued to accelerate and with the Group geared towards demand for affordable housing, urban regeneration and infrastructure and construction investment, I am excited by the significant opportunities ahead.

“Our high-quality secured workload and our operational delivery capabilities give us great confidence for the rest of the year and as such, we expect to deliver a full year performance significantly ahead of our previous expectations.”