Morgan Sindall, the construction company with interests ranging from affordable housing to tunnels for electrical cables, has announced record results and said that orders of £2.8bn left it “excited” about 2006.
The company, which employs more than 5,000 people in the UK, saw annual pre tax profits to the end of December rise 23% to £41.7m and said it was “in even better shape” than 2005.
Revenues increased by 6% to £1.3bn.
The company’s improved profitability was mainly due to the performance of its divisions involved in fit-outs and refurbishments and also affordable housing, which operates under the Lovell brand.
Its construction division – which specialises in government contracts for schools and hospitals under the Bluestone banner – saw earnings climb while its Morgan Est infrastructure business maintained its profit margins despite a “subdued” civil engineering market.
The firm – formed in 1994 from the reverse takeover by William Sindall of Morgan – said the growing shortage of affordable housing meant its Lovell business had an order book of £1.34bn over ten years.
Lovell, which specialises in developments combining homes to be owned by local authorities and others for sale on the private market, saw its operating profits rise 40% to £18.7m on revenues up 7% to £390m.
Refurbishments, including the kitchens and bathrooms of existing homes along with the public areas surrounding them, now make up half of its work.
Contracts won by the infrastructure division in 2005 include engineering work for Metronet at London’s Kings Cross Station and another creating a 10km cable tunnel in Croydon for National Grid.
The slowdown in civil engineering meant its operating profits slipped 23% to £6m on revenues down 25% to £248m.
Bluestone, which has 25 local offices, secured two more NHS-based contracts in South East Hampshire and Doncaster, bringing its total to four.
The order book stood at £504m compared with £197m a year ago, Morgan said, while profits grew 146% to £3.2m on sales of £336m, up 24%.
And the division responsible for fitting out hotels, shops and leisure premises grew profits 46% to £16.4m as it benefited from the opening of Manchester and Birmingham offices.
The division trades as Overbury, Morgan Lovell, Vivid Interiors and Backbone Furniture and said more regional offices were planned for 2006.
References: EGi News 22/02/06
