Building and infrastructure group John Laing today said its own bout of structural work had set it on course for better times.
The group is in on course to complete a shift away from housebuilding to more specialised operations, including managing PFI projects and operating railways.
After selling off a string of businesses last year, including the £295m sale of its housebuilding operation, chairman Bill Forrester said its new focus would guarantee “predictable and secure” earnings in the longer term.
The company is now focussed on Laing Investments, which specialises in roads, rail and public building projects as well as the Chiltern Railways franchise.
The shift comes after the company plunged into the red in 2001 because of difficulties at its construction arm. The division was later sold.
The London-based group today said it had narrowed bottom line losses from £30.3m to £18.6m in 2002.
Forrester said: “The low risk contractual agreements we have with public sector clients and government agencies on many of our projects means that our earnings streams are both predictable and secure.
“This, combined with growth in the underlying value of the portfolio as our investments mature, means we can look forward to a significant increase in profits from our existing portfolio in the years ahead.”
As well as the sale in October of its main housebuilding business to George Wimpey, Laing brought in another £41.5m from offloading its plant hire operation and its office and industrial property-based development business.
The group said today it had used the proceeds from the disposals to clear debts and finance new acquisitions to beef up its investments division, which now includes eight projects bought from Amey earlier this month.
Its accommodation operation Equion last year clinched two major public sector deals, including a contract to build 17 police stations in the Greater Manchester area and a £40m relocation of South East Essex College.
Meanwhile, Laing Rail secured its long-term future with a 20-year passenger franchise to run Chiltern Railways.
Laing also set up a new rail projects business in June to focus on projects such as new
stations and platforms.
Turnover from continuing operations for the trimmed down group rose to £249.6m from £159.0m.
The company is in the process of selling its remaining interests in the housebuilding sector, including Beechcroft developments.
References: EGi News 17/03/03
