Keltbray targets costs after record £563m turnover

Aaron Morby 1 year ago
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Leading specialist contractor Keltbray is on track to cut overheads by 16.4% this year as it reshapes the business for tougher trading.

Chairman Brendan Kerr says Keltbray will re-scale its operations when normal trading conditions return
Chairman Brendan Kerr says Keltbray will re-scale its operations when normal trading conditions return

The firm said it had set its sights on industry-leading cost efficiencies after unveiling turnover up 41% last year to a record £563m.

Chairman Brendan Kerr said Keltbray would continue to review the over-head run rate to ensure it met target when the business returns to full operational capacity.

Last month Keltbray said it would target 300 redundancies from around 2000 staff.

Kerr said the group would continue with its strategy to diversify from low to higher-value work, particularly expanding its activity in the transport and utilities sectors.

He added that last year’s strong trading against a backlog of political uncertainty and project delays caused by Brexit had left Keltbray in a strong position despite cooling market sentiment and eroded margins seeing pre-tax profit fall to £10.5m down from nearly £18m the year before.

Keltbray ended its financial year in October 2019 with net funds of £41m, including £21m net cash and £20m secured banking facilities.

Its specialist contracting services arm saw revenue jump 39% to £396m, while the rail and infrastructure business revenue jumped 45% to £167m.

Darren James, group chief executive said: “We are managing actively the impact on the current trading year of Covid-19 and other market factors.

“Although this and other uncertainties remain, particularly the UK’s relationship with Europe, we are confident that the UK Government’s focus on economic recovery, founded on investment in economic and social infrastructure, will create significant medium and long-term growth opportunities for the Keltbray group. This is now being reflected in a growing opportunity and tender pipeline.

“Our focus in the period ahead, is to work closely with our customers, rebound from Covid-19, drive improvement in operational effectiveness together with investing in our strategy for growth .”

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