A contract to improve North-East housing helped construction group Morgan Sindall to record end of year results.

The group's affordable housing division, Lovell, which has offices in Stockton, is engaged on Wearside in a £25m property modernisation programme for Sunderland Housing Group.

It has also won a £30m contract with Your Homes Newcastle.

Lovell put in what the group described as another strong performance last year, with turnover up 31 per cent from £279m in 2003, to £364m last year.

Operating profit rose from £8.92m in 2003 to a record £13.45m last year. Its forward order book is a record £1.34bn - more than half that of the entire group.

So far, in Sunderland Lovell has carried out improvements on 900 homes, including installing kitchens and bathrooms, doors, central heating systems and boilers, plus rewiring work and external jobs such as fencing and re-pointing brickwork.

In Newcastle, it will be partner contractor for Your Homes Newcastle and will carry out £30m-worth of improvements to 4,000 homes for the management organisation. Lovell's managing director, Stewart Davenport, said: "Lovell's market-leading success in delivering large-scale housing refurbishment schemes and mixed tenure development is reflected in our record financial results. Continuing investment from the Government's Decent Homes and Sustainable Communities programmes leaves us strongly placed for continued growth in the North-East and Yorkshire, where we are working on a number of high profile housing modernisation projects."

Total group profits for the year increased 34 per cent to £27.94m from £20.92m in 2003.