Successful construction firm doubles its profits; CONSTRUCTION.
Byline: GRAEME WHITFIELD firstname.lastname@example.org
ACONSTRUCTION firm involved in some of the region's most prominent building projects has more than doubled profits despite increasing turnover only by 4%.
Accounts for Sunderland's Brims Construction for the year ending March 31 show that turnover went from PS25.1m to PS26.1m, but operating profits increased from PS500,000 to PS1.1m, exceeding directors' expectations.
Profit after tax also more than doubled while Brims' cash balances increased from PS5m the year before to PS7.9m.
In a note on the accounts, Brims' commercial director Ian Clift said the company had increased its margins after seeing improvements in its supply chain and an easing in the construction industry's skills availability. Mr Clift also outlined some of the major contracts the company had been involved in during the year, including two student accommodation builds in Newcastle, refurbishment of academic buildings at Durham University and the completion of a surgical centre at South Tyneside District Hospital.
He added: "The construction sector continued to generate an improving pipeline of projects, albeit at a similar slow rate as note last year. Build cost increases moderated as the availability of skilled labour and subcontractors improved.
"A number of our competitors continue to pursue a strategy of maintaining or increasing turnover at the expense of margin, which we now consider when selecting which projects to tender. When targeting work we have also continued to focus on risk management, margin and cash. Pleasingly, even with this approach we have still increased our sales revenue by 4% during the year. Operating margin also increased to 4% compared to 2% in 2016.
"Conditions in the supply chain have eased this year and we are generally able to source the skills and materials we need. Our supply chain has a critical role in our delivery to clients and we continue to look for ways to work more collaboratively."
Mr Clift said the company was looking strong going forward with an order book of PS35.7m in 2017. It is currently involved in the building of a new HQ for online gambling firm Tombola in Sunderland and in the conversion of the former Shire Hall in Durham into a Hotel Indigo, while it has also completed the award-winning Liveworks office block on Newcastle's Quayside and a seafood restaurant for Colmans in South Shields. Mr Clift added that the EU referendum result "may cause some uncertainty in our markets", but he said that Brims' board remained confident of continuing expansion over the next few years.
Over the year Brims' employee numbers dropped from 80 to 73, with the largest reduction coming in site managerial staff. Both staff costs and directors' renumeration fell slightly from the year before.
Brims dates back to 1882 and was run by the family of the same name until the 1960s when it was sold to Tyneside shipbuilders Swan Hunter. The firm was wound up in 1993 but revived in 2006 by brothers Jason and Richard Wood and fellow director Mr Clift.
How the new Tombola HQ will look in Sunderland
|Printer friendly Cite/link Email Feedback|
|Publication:||The Journal (Newcastle, England)|
|Date:||Aug 28, 2017|
|Previous Article:||United chief won't attend Sports Direct meeting.|
|Next Article:||Birtwisle brings up his 10,000; NORTH EAST PREMIER LEAGUE.|