Interserve bets on construction recovery in 2014

Aaron Morby 11 years ago

Profits at Interserve’s UK construction arm fell 27% to £7.3m in the first half as margins came under pressure in a more challenging market for main contractors.

The firm warned that it expected the construction market to remain subdued until 2014, but said that support services continued to grow strongly.

Despite the downturn, Interserve’s UK construction business managed to maintain turnover at £366m as the construction team secured work for new clients such as Jaguar Land Rover and Viridor, and reaped work from longterm partnering deals with National Grid and Magnox.

UK construction margins fell from 2.7% a year ago to 2% in the first half of the year, although future workload was relatively stable year on year at £1.1bn.

The international construction arm picked up further power sector orders in both Oman and Qatar and maintained turnover at around £100m, delivering a £7m profit.

Chief executive Adrian Ringrose said: “We expect both UK and international construction revenues to remain subdued in the near term with growth potentially resuming in 2014.”

Across the Interserve Group first half turnover rose 3% to £1.2bn and profits were also up 8% at £32.6m, supported by growth in support services.

Ringrose said: “We have delivered a good set of results against a backdrop of continuing mixed market conditions.

“Our ability to offer our clients intelligent solutions is reflected in growing revenues and profits together with an increasing future workload.”

He added: “Support services generated strong growth accompanied by a robust performance from construction and a continuing recovery in equipment services.”

Support Services UK delivered a strong performance, with revenues up 11.5% at £572m as a result of our focus on account development and new business wins.

Its contribution to group profit rose 24% to £19.6m with an uplift in operating margin to 3.4% (H1 2011: 3.1%), reflecting further cost reductions and the emerging scale benefits of increased revenue.

The division derives 65% of its revenues from the public sector and 35% from the private sector, with major customers such as the Ministry of Defence, DEFRA, the Foreign and Commonwealth Office, Sainsbury’s, Prudential and Alliance Boots.



Latest news

Bid rigging: Keltbray to appeal and so could Squibb

Both contractors "disappointed" with level of fines
3 days ago

Ten demolition firms fined £60m for bid rigging

Full details of fines with Erith and Keltbray hardest hit
3 days ago

Retail contractor J M Scully files administration notice

£23m turnover Dorset based contractor lodges court notice
3 days ago

Civils specialist M Lambe delivers record performance

Housing civils specialist seeks to diversify in face of challenging housing market
3 days ago

Willmott Dixon clinches £60m Oxford Brookes University job

Preparation work starts on two new buildings at Headington Hill campus
3 days ago

Ferns seals £50m+ Openreach network services deal

Five-year south west deal to provide civils, poling and complex manhole programme
3 days ago

20 firms win £4.5bn Southern construction framework

A dozen new firms secure spots on fifth generation public sector deal
4 days ago

Call grows for bolder 18m second staircase rule for flats

Architects, surveyors and builders professional trade bodies demand lower height threshold than proposed 30m
4 days ago

GRS Roadstone warns staff following cyber attack

Materials giant sends out letters highlighting the extent of the attack
4 days ago

Inland Homes to suspend shares as results delayed again

Auditors need more time to go through embattled house builder's books
4 days ago

Kier wins £73m Southport events centre job

Local supply chain set to benefit from major new project
4 days ago

Multiplex profit rebounds as margin restored to 2.9%

London tower builder predicts return to revenue growth this year as major schemes advance
4 days ago

Upbeat Vistry to re-open mothballed offsite factory

Former Countryside timber panel factories rebranded Vistry Works in revived drive to deliver 5,000 units a year
4 days ago

Builder crushed and blinded in wall collapse

Property owner in court after barn conversion goes horribly wrong
4 days ago

Keltbray bags £140m haul of energy infrastructure work

Specialist secures trio of power frameworks, two battery storage facilities and an energy from waste package
4 days ago

Government awards £1.8bn for energy retrofit schemes – list

Housing and public building decarbonising funds awards to support 20,000 construction jobs
5 days ago

Landmark London scheme switches from flats to student rooms

Regal London rethinks Old Kent Road scheme with 900 student rooms and 220 affordable homes
5 days ago

Align reveals designs for final portal of HS2 tunnel

Contractor confirms how final key structure on project will look
5 days ago

Plans in for 1.4m sq ft of industrial space at Fiddlers Ferry

Peel NRE to appoint demolition contractors for coal-fired power station in weeks
5 days ago

Tilbury Douglas to replace hospital hit by weak concrete

Stoke-on-Trent outpatients building containing Reinforced Autoclaved Aerated Concrete to be replaced
5 days ago

Derby picked as destination for Great British Railways HQ

Public vote secures Derby's bid to be nerve centre of the rail industry
5 days ago

London tower over historic Leadenhall market approved

Building work to start in 2025 on 32-storey tower by historic city market
6 days ago

PfH starts race for £520m housing decarbonising deal

Four-year framework covers service specific lots from £5m to £100m
6 days ago

“Rock solid” balance sheet and record results for Henry Boot

Firm sees early signs of recovery this year in core markets
6 days ago

£200m Edinburgh Haymarket office and hotel approved

Haymarket Yards scheme to move to construction in 2024
6 days ago

Countryside closes deal for £80m build to rent homes

Deal with private rental developer Sigma to speed up delivery at two sites
6 days ago

Wates commercial director joins Caddick

Neil Trubshaw one of a string of appointments as contractor looks to expand across the north
6 days ago

Fusion21 names 16 winners for £125m painting framework

Latest deal will last four-years for public sector clients
6 days ago

Watkin Jones breaks ground on Cardiff 700 flats scheme

Largest build-to-rent scheme in Wales gets underway
7 days ago

Green light for Birmingham 540-bed student scheme

Work to start on Gough Street student tower this summer
1 week ago

Contractor services