Robertson says project bank accounts will force margin rises

Aaron Morby 7 years ago
Share

Stirling-based Robertson Group is predicting main contractors will have to rebalance margins as project bank accounts become commonplace on public sector work in Scotland.

Bill Robertson believes main contractor margins are set to rise as business models change
Bill Robertson believes main contractor margins are set to rise as business models change

Chairman Bill Robertson predicted a fundamental business model shift as he unveiled another year of strong profit growth to March 2016.

He predicted further upward pressure for healthier main contractor margins would result from greater involvement of private sector funders in the industry.

Robertson said: “Due to the changing source of funders in our market the group board believes that healthier margins in our sector will be a requirement of participation by funders to major projects and businesses.

“Our group companies therefore will continually focus on a growing return on capital and improving risk profile in our projects in preference to growth in volume.

“Indeed, in construction, if the intended project bank account process promoted by the public sector is pursued across the industry, the additional profit element required to operate such a scheme will require a rebalancing of margins within the industry.”

Over the year Robertson nearly doubled pre-tax profits to £21m on record turnover of £453m, while building its strongest ever forward order book at £2bn.

The group is now planning to double turnover over the next five years.

More than £100m of revenue is presently generated in England where the diversified Robertson Group has been steadily building its presence with a new Yorkshire and East Midlands office in Sheffield.

Robertson said the group had seen continued and sustainable growth across its 19 diverse infrastructure-based businesses, most notably in its construction, house building and partnership homes businesses.

Over the last 18 months the fast expanding group has taken on over 600 staff taking total headcount to nearly 2,000.

This year it aims to recruit a further 100 staff as it maintains a focus on using direct labour to maintain competitive advantage in the current skills crisis.

Partnership homes grew strongly and has now secured contracts to deliver over 2,500 homes over the next five years in Scotland. The firm also formed a partnership homes business in the North of England.

The group also expanded its offering in building services, civil engineering and rendering and roofing over the last 12 months.

Robertson Capital Projects, the group’s investment business, has successfully utilised its strong group working approach by involving its sister businesses in construction and facilities management to secure preferred bidder status for the delivery of a new £62m hospital in Kirkwall for NHS Orkney.

The investment will be run on 30-year concession commencing on financial close, which is anticipated in February 2017.

The homes business is operating on eight sites in Scotland including new developments in Dunbar, Strathaven and Mid Calder in Central Scotland. Robertson Homes also plans to develop quality family homes in the North of England, with four sites identified. 

Latest news

Police ban mobile cranes from roads over Easter

Plant hire bosses livid as forces across the country extend abnormal load embargoes
20 hours ago

Director jailed for exposing workers to asbestos

Ten tonnes of asbestos insulating board stripped out by unqualified workers
24 hours ago

Site labour rates start rising again

Industry's biggest payroll firm says "it feels like things could be turning round"
1 day ago

Council finds extra £33m for Buckinghamshire link road

South East Aylesbury Link Road costs soar by nearly 30% to £147m
1 day ago

Quartet win £490m North West & Central railway works deal

Skanska, Kier, Octavius Infrastructure and Story Contracting bag major projects deal
1 day ago

Unite Students plans first major mixed-use scheme

Developer's first mixed BTR and PBSA project to be built in Edinburgh
2 days ago

Galliford Try names new finance director

Rentokil's Kris Hampson joins contractor to replace Andrew Duxbury
1 day ago

Council boss hits out at bat threat to £274m road job

Natural England could scupper scheme due to be built by Ferrovial
1 day ago

Hydrogen-fuelled diggers to be allowed onto highways

Government to raise barrier to widespread use of hydrogen fuelled plant in construction
2 days ago

Plans in for £118m Government hub in Darlington

Work pencilled to start later this year on new home for 1,450 civil servants
2 days ago

New contractor highlights Henry Construction jobs on website

New firm lists jobs by failed contractor to show its experience
2 days ago

Contractors line up for £2.6bn Anglian Water AMP8 deal

Eight big names land places on pioneering @one Alliance
3 days ago

McAleer & Rushe bags first major later living project

Work to start this month on 167-flat Royal Tunbridge Wells project
2 days ago

Kier starts first all-electric prison houseblock job in Kent

Next-generation fully electric T60 prison houseblock to be built at HMP Elmley
2 days ago

Keepmoat sees better times ahead in housing market

Profits dip in 2023 despite construction of record number of new homes
2 days ago

Vistry signs partnership deals for 1,900 mixed tenure homes

West Sussex former airfield and Newmarket sites to break ground
3 days ago

Turnover at Wates tops £2bn for first time

Construction division exceeds £1bn turnover as average contract value hits record high of £48.3m
3 days ago

L&G looks to sell Cala Homes in exit from house building

Insurance giant reported to be preparing to offload 3,000 homes-a-year developer
4 days ago

Multiplex profit almost trebles as margin hits 5.5%

Revenue jumps 20% to £675m as big London scheme complete
3 days ago

TopHat puts plans to open huge Corby factory on hold

Advanced manufacturing facility was due to employ 1,000 people
3 days ago

Laing O’Rourke lands Calderdale hospital job

Enabling works to start by the end of this year at West Yorkshire site
3 days ago

Go-ahead for £475m Sunderland film and TV studios

Work to start this year on first phase Corwn Work studios
3 days ago

Willmott Dixon set for £20m Stockport Community Hub

Planning decision expected in June on Marple leisure and health clinic project
3 days ago

Police hunt for blundering dumper truck thief

Raider drove into a fence before getting stuck on a bank
3 days ago

Beattie Passive files administration notice

Passivhaus pioneer has been in business for more than ten years
4 days ago

McAlpine set for £50m space and tech centre

Northumbria Uni sign pre-con deal for new satellite research hub
4 days ago

VolkerFitzpatrick seals £34m Kent road viaduct

Work to start next year on Sturry Link Road near Canterbury
4 days ago

Eight win £600m Scottish civil engineering framework

Balfour, Farrans, Graham and Morgan Sindall win major works lot
4 days ago

Site engineer crushed to death by excavator

22-year-old victim died just months after graduating from university
6 days ago

NG Bailey fined £135,000 after hospital site death

Worker died after striking overhead beam while navigating a mobile elevating work platform
7 days ago

Contractor services