By Sandy Guthrie07 March 2012
UK contracting group Costain has reported a 38% increase in group operating profit for the year ending 31 December, 2011, plus a year-end order book that has increased to £2.5 billion (€2.99 billion).
Chairman David Allvey said, "The group has been successful in targeting those blue chip customers who are spending billions of pounds per annum on essential capital projects and ongoing maintenance of essential, nationally strategic assets. This provides a major opportunity to grow the business further."
He added that he was confident that the group would achieve its aim of doubling its profit over the medium term.
Costain saw an increase of 38% in adjusted group operating profit to £24.1 million (€28.9 million) for last year. It said it ended the year with a £140 million (€167.7 million) net cash balance, and no significant debt.
Mr Allvey said, "We are transforming Costain into a broad-based Tier-One engineering solutions provider, aligned with structural market changes."
He said that winning projects such as the £400 million (€479 million) London Bridge railway station redevelopment was testimony to that. He claimed that a strong cash position, robust balance sheet, and increased banking and bonding facilities provided Costain with the resources to grow the business by acquisition as well as organically.
Chief executive Andrew Wyllie said the company was developing the skills, capabilities and service offering necessary to meet the changing needs of its major customers.
"In addition to the organic development of those skills within Costain," he said, "for the first time in over 20 years Costain augmented the implementation of its strategy through the acquisition of two businesses - ClerkMaxwell, an upstream oil and gas consultancy, and Promanex, an industrial support services business. Both businesses have been integrated successfully, and are performing well and in line with our expectations."
He said that the majority of spending in the future would come from the private sector, and that the board of Costain continued to believe that, over the next decade, such expenditure would be primarily in the critical areas of transport, energy, water and waste.
The group's core business segments are in Infrastructure (highways, rail and airports), Environment (water and waste) and Energy & Process (hydrocarbons and chemicals, nuclear process and power).