Carillion construction profits jump by 41%

Grant Prior 11 years ago
Share

Carillion saw operating profits at its UK construction division jump 41% last year.

The support services giant continued to be selective about contracts as it continued with plans to scale down its UK construction operations by a third by this year.

Results released today show construction turnover in this country fell 24% to £1.3bn for the year to December 31 2011 while operating margins rose to 3.1% from 1.9% and operating profit shot-up 41% to £57.9m

The firm said: “Our decision to re-scale UK construction anticipated the Government’s cuts in capital spending of some 30% in real terms over the current four-year spending plan.

“It has also helped us to improve the operating margin in this segment, as we have avoided bidding for lower margin work at a time when the UK market is becoming increasingly competitive.

“In 2012, UK market conditions are expected to remain competitive as Government cuts in capital spending continue to bite.

“We will continue to re-scale our UK business by maintaining a very selective approach to the contracts for which we bid, which will also continue to support margins.”

Carillion bought Eaga last year for £306m to boost its energy services division.

The accounts show the company spent £40m in redundancy and restructuring costs at Carillion Energy Services as part of a cost-cutting drive following the acquisition.

The firm is half way through a redundancy programme with up to 1,500 jobs to go.

Group-wide, Carillion saw turnover stay flat at £5.1bn with pre-tax profit down 15% to £142.8m.

Chairman, Philip Rogerson, said: “Carillion’s integrated UK support services and international business mix has once again enabled the Group to perform strongly, despite challenging market conditions.

“Given the wider economic outlook, we expect trading conditions to remain challenging in 2012.

“However, with a strong and resilient business, good revenue visibility and a record pipeline of contract opportunities, we continue to target growth in support services together with the doubling of our revenues in the Middle East and in Canada, in each case to around £1 billion, by 2015.

“Consequently, Carillion remains well-positioned to deliver further growth in 2012 and beyond”.

Latest news

Graham hospital site hut complex destroyed by blaze

Site offices ravaged by fire which took eight hours to get under control
57 mins ago

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

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

Buyers see brighter days ahead despite resi slump

"Construction can see a path through for better outcomes in 2023"
5 hours ago

Australian firm to buy £300m gigaplant backer Britishvolt

New owner vows to complete giant factory in Northumberland
8 hours ago

Project delays curb Ardmore growth ambitions

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

Scaffolders and sparks strike at antibiotic plant

Engineering construction workers down tools in bonus pay row
7 hours ago

McAlpine bags £1bn Sellafield concrete structures deal

Contractor signs 17-year concrete structures and groundworks framework
17 hours ago

Moving in to new markets paying off for McLaren

Contractor carving out new niche as leading player in heavy refurbs
3 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
7 hours ago

Plan to add retentions record to payment reporting law

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

Morgan Sindall wins £88m Beckton DLR depot upgrade

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

Hare and Severfield win £250m Sellafield deal

Country's two biggest steelwork contractors secure 17-year framework
3 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
3 days ago

McLaren wins massive Portland House refurb

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

Green light for £275m HS2 Midlands nerve centre

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

Winners named for Government £10bn offsite framework

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

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

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

Staff at Outco Surfacing start looking for new jobs

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

£4.75m building work provision tips Higgins into the red

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

John F Hunt snaps up London temporary works design firm

Demolition contractor buys geotechnical and structural engineering design specialist RKD Consultant
4 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
4 days ago

Galliford Try to start £14m Scunthorpe Market scheme

Firm will build NHS staff accommodation and offices in two phases
4 days ago

Vast £500m British Library expansion go-ahead

London Mayor still needs to give final nod to 800,000 sq ft extension at St Pancras site in London
5 days ago

Wates names new chief executive

Cork-born Eoghan O’Lionaird to join later this month
5 days ago

Keltbray director joins Barhale as North East chief

Mark Wood heads operations in Yorkshire and North East England
5 days ago

Major London City building green deep retrofit approved

St Bride’s Tavern near Fleet Street will be demolished for the building expansion
5 days ago

Gilbert Ash lands starring role in £38m Welsh theatre revamp

Contractor to start work this year on Theatr Clwyd upgrade
5 days ago

Property clients to ramp up spending on decarbonising

Survey reveals nearly half of property chiefs plan to speed up spending on net-zero programmes over next twelve months
5 days ago

Average self employed labour rates top £1,000 a week

Average weekly earnings reach high for skilled trades
6 days ago

BAM wins £49m Harrogate Convention Centre revamp

Local council hopes to sanction work start this autumn
6 days ago

Contractor services