Civils firms boast strong results

This year is proving to be yet another booming period for UK civil engineering firms, despite the general doom and gloom surrounding the economy.

Listen to Capita Symonds chief executive Jonathan Goring

Three firms reporting results for the first six months of 2008 this week revealed increased revenues and profits.

Consultant WSP reported a revenue of £363.5M for the six months to 30 June 2008, up 40% from £259.8M during the same period in the previous year, inclusive of acquisitions.

Pre-tax profits were £23M, up 43% from £16.1M in the first half of 2007, with pre-tax profit margins rising marginally from 6.2% last year to 6.3% this year.

It also revealed its forward order book was at the record level of £1.2bn.

WSP chief executive Chris Coles credited the firm's international presence, especially in the Middle East, as driving its strong growth.

 

Rival consultant Capita Symonds meanwhile reported its strongest six months performance since the firm was bought by parent Capita in 2004, with turnover for the first half of 2008 up by 11.6% to £134.5m compared to the first half of 2007.

Continued strong performance in the local authority business has produced a strong order book and niche acquisitions such as the most recent purchase of prison building services specialist Pearce Buckle, have boosted the firm's capability across sectors.

"For us (the market) is not too tough at all because we are 95% in areas of business that are fairly well insulated (from the economic downturn)," said chief executive Jonathan Goring. "A lot of our business is in local government. Local government receipts will start to feel the pain and if we start to see any issues it will be next year." 

Goring said that he confident of delivering growth over the next few years but said this would not necessarily mean revenue growth as the focus was around boosting profitability.

"I think that we have been able to build a much better business over the last two or three years and as a result people are performing better and enjoying work more," he said.Ground engineering firm Keller Group this week announced a 28% rise in revenue and a 19% rise in pre-tax profit from continuing operations for the first half of 2008.

The success of its interim results – for the six months ending 30 June – were in part due to growth in the Eastern Europe, Middle East and Australian markets, said Keller chief executive Justin Atkinson.

He also said the firm expected to easily exceed its earlier projected £1bn for revenue this year, up on £955.1M for 2007, despite the hit to the UK housing sector, which historically accounts for 30% of its UK ground engineering revenue.