Mears converts half of bids into contracts

Aaron Morby 13 years ago

Mears is converting more than the half the social housing and care home work it bids into contracts.

The housing maintenace specialist said it had achieved a bid conversion rate of 56% of all housing jobs it priced and more than 60% of care homes work.

The enviable hit rate helped the firm to bag £300m worth of contracts in the last six months.

David Miles, Mears chief executive, also dismissed talk of margins in the sector coming under pressure. He said that an unprecedented level of new work opportunities meant the firm could remain selective about the work it chased.

The sales pipeline stands in excess of £3bn, of which £1.7bn of new contract opportunities are coming up for award within the next 12 months.

Unveiling strong half-year results, Mears said it had cashed in on the demise and Rok and Connaught and picked up a substantial haul of work from both contractors’ former clients.

These include a 10-year contract with Barnet Homes worth £69m, due to start in October 2011 and deals with Notting Hill Housing and Arun District Council, together worth up to £53m, also due to start shortly.

The former Bristol social housing division of Rok, acquired last year, has also picked up a £21m housing repair job with Neath Port Talbot Homes, due to start in October..

Miles said: “We have secured significant work in the emerging environmental improvement space and in the bid room we have benefited from winning work previously held by Connaught and Rok. This has been achieved during a period of significant public sector change.”

He added: The future outlook is also excellent, given the strength of our operational delivery and the move towards greater investment in energy efficiency in housing.”

Turnover in the six months to the end of June rose 16% to £293m despite signs than Decent Homes work is starting to tail off. Adjusted pre-tax profit rose 7% to £14.1m.

    Trading by division

    Social Housing Division
    · Revenue increased by 12% to £207.2m
    · Operating margin increased to 5.5%
    · Further development of the British Gas partnership
    · New contract bidding success rate (by value) of 56%, amounting to a value of £268m

    Care Division
    · Revenue increased by 8% to £51.7m
    · Operating margin maintained at 7.5%
    · Continuing trend of Local Authorities to procure services from fewer and larger care providers
    · New contract bidding success rate (by value) of 60%, amounting to a value of £39m

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