BAM trading steady after second half uplift

Aaron Morby 1 month ago

The UK construction operations of Royal BAM delivered a stable performance last year after a better second half.

BAM CEO Rob Van Wingerden says UK delivered a good performance last year despite Brexit headwinds
BAM CEO Rob Van Wingerden says UK delivered a good performance last year despite Brexit headwinds

After a slow start to 2019, performance picked up at both construction and civils to deliver flat revenue and profit for 2019 at £1.6bn and £49m respectively.

Rob van Wingerden, CEO of Royal BAM Group, said the business remained focused on margin above volume, and the quality of the current order backlog was high despite Brexit headwinds.

Across BAM’s two main operating divisions in the UK, building and property arm BAM Construct outperformed its BAM Nuttall civils business delivering a 12% rise in operating profit to £30m on flat revenue of £889m.

BAM Nuttall suffered a 15% fall in profit to £19m on revenue slightly ahead at £737m.

Commenting on building and property performance, van Wingerden, said: “In the UK, the uncertainty regarding Brexit resulted in a lower order intake during 2019 and in some regions the competition for new contracts increased.”

But he added that recent involvement in large framework contracts like the Crown Commercial Sevices construction deal where BAM secured nine regional lots was expected to support future activity levels.

He added that BAM Nuttall had delivered a stronger performance in the second half-year as expected.

Van Wingerden said Royal BAM was making good progress to unify business programmes for finance, IT, procurement and HR under its One BAM initiative, designed to leverage benefit from scale and skills within the group.

“Having embedded the tender stage gate process to better control the risks entering our business, we are now implementing a Uniform Project Approach to delivering major projects.” he said.

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