Interserve has £250m war chest for acquisitions

Grant Prior 10 years ago

Interserve has built up a war chest of £250m to fund future acquisitions as the firm predicts a return to growth in the construction market next year.

Interserve posted a strong set of results today with headline pre-tax profit up 7.7% to £78.4m on turnover up 6% to £1,958.4m for the year to December 31 2012.

Support services was the star performer with a 21.7% rise in UK operating profits to £44.3m as margins improved to 4% and turnover ticked up to £1,118.1m from £1,007.3m last time.

UK construction had to cope with “challenging conditions” during the year which saw UK operating margins pushed down to 2% from 2.5% as operating profit fell to £14.6m from £18m on turnover which stayed steady at £737.2m.

Interserve said it expects construction margins to “trend between 1.5 to 2.0 per cent over the medium term.”

The firm said: “We expect the UK construction market to continue to remain challenging during 2013, before a resumption of gradual growth from 2014, stimulated by increased government spending on infrastructure and some recovery in private sector investment.

“However, we have a strong order book and continue to diversify the business to position ourselves for growth across an expanding set of market segments.”

Interserve confirmed it has £250m available “to fund strategic growth opportunities.”

It added: “We maintain a disciplined approach to reviewing potential acquisition opportunities, rejecting those which do not meet our strict valuation and other selection criteria but with a strong balance sheet, and significant available debt capacity and facilities, we remain well placed to take advantage of further appropriate acquisition opportunities as they are identified.”

Profits were up 17.6% to £16m at Interserve’s Equipment Services division which specialises in formwork and falsework.

Chief Executive Adrian Ringrose said: “2012 was a very good year for Interserve, in mixed market conditions. We grew earnings, generated strong cash flow and made good strategic progress.

“We won over £2.7 billion of work during the year, expanding our future workload to £6.3 billion.

“We have confidence in our ability to make further progress in 2013, with further improvements in Support Services’ margins, and continued recovery in Equipment Services offsetting soft Construction markets.

“Looking further ahead, with good potential in our existing sectors, expansion into new markets and our strong balance sheet, our medium-term growth prospects remain strong.”






Latest news

Gove invites Kingspan for talks on fire safety compensation

Insulation firm urged to pay for its part in cladding crisis after unveiling record profits
2 hours ago

Galliford Try and Midgard bag 350 homes deal at Brent Cross

Galliford Try will build 249 BtR flats and Midgard 107 flats for sale
3 hours ago

Sizewell C project gains key environmental permits

Waste permits allow client NNB Generation Company to move to site investigation and construction environmental approvals
2 hours ago

Cost of Robertson school contract soars to £100m

Construction to start next month after cost jumps from original £60m
3 hours ago

House building cost inflation eases as build out rates fall

Housing cost inflation expected to grow by 1.4% this quarter
1 hour ago

Modular builder ilke Homes hires Deliveroo chief to drive profit push

David Scott charged with making business profitable
2 hours ago

£500m Leeds South Bank scheme gets green light

Leeds City Council approves plan for 1,350 flats in mixed-use South Bank development
1 day ago

Galliford Try takes rebid £150m Carlisle Southern Link Road

Main construction works are due to start on 8km road in June
2 days ago

Arup takes stake in graphene-enhanced concrete venture

New concrete additive Concretene™ promises 30% savings in CO2 emissions
1 day ago

Winners revealed on £1.42bn materials framework

Thirteen builders merchants land places on huge procurement deal for social landlords
1 day ago

Travelodge eyes plans for another 300 hotels

Hotel giant writes to local councils offering partnership deals with a £3bn investment target
1 day ago

Balfour Beatty to invest £60m in pop-up EV chargers

New Urban Fox JV will roll out 35,000 charge points across the UK over the next decade.
2 days ago

Leading Channel Isles builder goes bust

Jersey-based construction firm Camerons placed in liquidation
1 day ago

HS2 Euston needs full design reset as costs set to double

Spending watchdog warns Euston stop-start delay will simply inflate already ballooning costs
2 days ago

Worker dies on major warehouse site in Stafford

Main contractor Glencar halts work while tragedy is investigated
2 days ago

Sellar switches London flats/hotel plan for 444 student rooms

Southwark's King’s Place scheme will comprise five buildings of up to 11 storeys
2 days ago

Bid race starts for Norfolk £30m Long Stratton Bypass

Council hopes to start work on 3.9km bypass in April 2024
2 days ago

GMI to build first warehouse at £200m Teesside business park

Work to start early next month on first shed at airport business park
2 days ago

Skanska Costain Strabag JV sets up own rebar plant

HS2 team now running on-site manufacturing facility to avoid supply chain issues
2 days ago

Bid rigging: Keltbray to appeal and so could Squibb

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

Ten demolition firms fined £60m for bid rigging

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

Retail contractor J M Scully files administration notice

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

Civils specialist M Lambe delivers record performance

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

Willmott Dixon clinches £60m Oxford Brookes University job

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

Ferns seals £50m+ Openreach network services deal

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

20 firms win £4.5bn Southern construction framework

A dozen new firms secure spots on fifth generation public sector deal
6 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
6 days ago

GRS Roadstone warns staff following cyber attack

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

Inland Homes to suspend shares as results delayed again

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

Kier wins £73m Southport events centre job

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

Contractor services