Morgan Sindall has delivered another record-breaking first half on the back of surging profits from its fit-out and construction arms.

Across the group revenue rose 7% to £2.4bn in the six month to the end of June with pre-tax profit up 37% to £96m.

The strong performance prompted a formal upgrade to targets across both fit-out and construction divisions.

Fit-out once again led the charge, with profit soaring 41% to £58m on £838m revenue, delivering a powerful 6.9% margin. The division is now expected to hit annual profits of up to £100m — a sharp upgrade on the previous £85m ceiling.

Construction also turned in a solid shift, with profit up 14% to £16m as margin hit 3.1%, helped by a strong run of public sector framework wins. The division has now been set a new revenue target of over £1.5bn, up from £1bn previously.

Group chief executive John Morgan also announced this morning that its Property Services, which made a modest £0.5m profit after a heavy loss last year,  will be fully merged into the Construction business from January, as the group streamlines its operational structure.

Morgan Sindall’s secured order book now stands at a record £12bn, with construction and fit out contributing heavily.

Morgan said: “It has been another record half year for the Morgan Sindall Group. These results further demonstrate our track record of delivering strong revenue and profit growth, supported by robust cash generation, enabling continued investment in our Partnership businesses, while importantly supporting strong dividend growth.

“In the period, we have continued to make significant strategic and operational progress.

“Expectations for the group are underpinned by the medium-term fundamentals for Fit Out which are expected to remain favourable, together with both our UK construction and partnership programmes which expect to benefit from the recent government investment commitments.”

Cash continued to be a key strength for the contractor, with the group ending the period sitting on £390m of net cash, up from £351m last year. Average daily net cash over the first half stood at £354m

Interim dividend was hiked 20% to 50p.