Lend Lease European construction profits rise

Aaron Morby 12 years ago
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Profits at Lend Lease’s European construction business have bounced back after several bad years.

The division, formerly known as Bovis, said that challenging market conditions saw turnover drop 14% to £721m in the year ending in June.

But profitability improved lifting post-tax profits 86% to £13.8m, ending a two-year run of falling profit.

The Europe, Middle East and Africa division’s performance, which includes development, was down on last year, due to several big one-off disposals of PFI stakes in the prior year.

New construction work secured over the year included the seventh stage of the Chiswick Park commercial development, Strathclyde University Technology and Information Centre, and 14 schools within the Birmingham BSF Programme.

Overall, the construction and property group’s operations in Australia, Asia, Europe and the US raised pre-tax profits by 2% to £327m on turnover up 29% at £7.6bn.

Lend Lease chief executive Steve McCann said the group was well placed to deliver earnings growth in the 2013 financial year supported by continued growth in the construction business, recognition of development profit on the first two commercial towers at Barangaroo South and profit from the sale of Greenwich Peninsula to Quintain Estates.

“In EMEA, market conditions in construction are expected to remain challenging.”

He added: “London residential is in the early stages of recovery which sits well with the timing of our major urban regeneration projects.

“In the Americas, difficult trading conditions are expected to continue, however activity levels in capital cities such as New York and Chicago are improving.”

McCann added: “In Australia, the infrastructure sector remains attractive and our focus will be on growth in key areas of specialisation including ports, rail, road and energy transmission.”

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