Billington boss fears more steel rivals will fail

Grant Prior 11 years ago
Share

Billington chief executive Steve Fareham fears more steel companies will fold as competition remains fierce in the sector and raw material prices continue to rise.

Fareham issued his warning as Billington recorded a pre-tax loss of £600,000 for the six months to June 30 compared to a £1.1m profit last time despite turnover ticking-up to £22.8m from £21.3m.

He said: “The number of business failures in the steelwork contracting sector remains relatively small, although with further increasing steel prices, recently announced, coupled with a harsh stance being taken by credit insurers, the directors believe there will inevitably be further casualties.”

Billington is braced for a slow construction recovery but is hopeful the market will pick-up next year.

Fareham said: “We are under no illusions, even though we expect margin pressures to ease in 2012; we realise that the construction market recovery will be a slow one.

“We remain cautious going forward, whilst positioning ourselves for growth.

“We have a strong balance sheet, the industry knowledge and relationships, to provide us with a degree of confidence in the current market conditions and look to 2012 with cautious optimism.”

The firm is still waiting to sign its first deal following the link-up with Bourne Steel to form the BS2 joint venture to go after larger commercial jobs in London.

Fareham said a number of developers are showing a “keen interest” and that the joint venture is looking to establish a turnover of between £10m and £20m

He told the Enquirer: “We have meet with most major developers to sound them out and they are very receptive to another major player in the market.

“We are being realistic and jobs like the Walkie Talkie and Cheesegrater towers are too big for us at the moment.”

Billington’s Easi-Edge safety barrier business is performing strongly despite the downturn and the firm has invested in new equipment as the Hoard-It site hoardings division also continues to grow.

Fareham said: “Easi-Edge has built up a reasonable percentage of the steel frame protection market and we are expanding in the timber frame sector.

“The hoardings business is also growing quite quickly and it shows that downturns do offer opportunities in niche areas.

“We have money in the bank but could look at more bolt-on businesses like this rather than structural steel acquisitions.”

Latest news

Balfour launches new guide for inclusive behaviour

Right to Respect inclusivity initiative shows "where the boundaries are"
9 hours ago

VINCI to build new £100m Blackpool office scheme

Contractor to build new seven-storey regional hub for civil servants
17 hours ago

Shapps to lead new Net Zero Government department

Business Energy and Industrial Strategy to split into three new Government departments
18 hours ago

Administrators appointed at concrete flooring specialist

Malin Industrial Concrete Floors has worked with a host of major contractors
18 hours ago

M&E firms readied for £545m Pagabo deal

New framework to meet demand for smarter buildings, particularly in healthcare and education
1 day ago

Mivan bags £100m haul of hotel and resi fit-out jobs

London hotel and prime residential orders put firm on track for £75m revenue this year
1 day ago

Graham hospital site hut complex destroyed by blaze

Site offices ravaged by fire which took eight hours to get under control
2 days ago

Mace wins £150m over-station job at Liverpool Street

Latest win from Aviva Investors and Allianz Real Estate following earlier Moorgate contract
2 days ago

Turner & Townsend and alinea join forces

110 alinea staff join T&T cost management team
24 hours ago

Developer confidence high in big regional cities

Crane survey reveals Birmingham, Leeds and Manchester can count on resilient development pipelines
23 hours ago

Caddick wins £21m Oldham off gas housing scheme

West Vale housing job forms part of £160m plan for 1,100 homes in Oldham
1 day ago

Buyers see brighter days ahead despite resi slump

"Construction can see a path through for better outcomes in 2023"
2 days ago

Australian firm to buy £300m gigaplant backer Britishvolt

New owner vows to complete giant factory in Northumberland
2 days ago

Project delays curb Ardmore growth ambitions

Refurb and housing specialist sees profit fall after challenging year of delays and supply chain failures
2 days ago

Scaffolders and sparks strike at antibiotic plant

Engineering construction workers down tools in bonus pay row
2 days ago

McAlpine bags £1bn Sellafield concrete structures deal

Contractor signs 17-year concrete structures and groundworks framework
2 days ago

Moving in to new markets paying off for McLaren

Contractor carving out new niche as leading player in heavy refurbs
5 days ago

Heavy materials sales fall amid slowdown in starts

Light side product sales grow helped by pace of activity for refurbs and energy-efficient retrofits
2 days ago

Plan to add retentions record to payment reporting law

Government consults on tougher reporting to include disputed invoices and retention policies
5 days ago

Morgan Sindall wins £88m Beckton DLR depot upgrade

Delayed work to start on Docklands Light Railway train maintenance depot in East London
5 days ago

Hare and Severfield win £250m Sellafield deal

Country's two biggest steelwork contractors secure 17-year framework
5 days ago

Max Steward returns to head up ISG’s Agility fit-out arm

Former ISG project director returns after three years to take up MD role
5 days ago

McLaren wins massive Portland House refurb

Construction to start this year on £380m revamp of 28-storey building in central London
6 days ago

Green light for £275m HS2 Midlands nerve centre

Trio of contractors battling it out to win huge new depot near Birmingham
6 days ago

Winners named for Government £10bn offsite framework

29 firms secure places on mega framework for schools, healthcare, defence and justice jobs
6 days ago

ISG, Amey and Costain now industry’s quickest payers – list

Average payment times from main contractors slip by a day
7 days ago

Staff at Outco Surfacing start looking for new jobs

Administration notice filed two years after acquisition of NMC Group
6 days ago

£4.75m building work provision tips Higgins into the red

Partnerships business counts cost of changes to building safety rules
6 days ago

John F Hunt snaps up London temporary works design firm

Demolition contractor buys geotechnical and structural engineering design specialist RKD Consultant
6 days ago

Vital Energi lands £13m package at Plumstead regen site

Specialist will start on site this summer helping to transform the former home of Arsenal FC
6 days ago

Contractor services