News on 20 September 2000
A bulging orderbook is leading Carillion to predict a healthy
outlook, despite losses at its Crown House Engineering subsidiary. The
company said it is confident of reporting a second half performance in
line with expectations.
In the six months to June 30, Carillion, which demerged from Tarmac a
year ago, reported significant successes in growth segments resulting
in a 13% rise in operating profit to £15.8m. Turnover for the six
months was some six per cent higher at £926m, primarily as a result
of an almost three-fold increase in PFI activities.
Chairman Sir Neville Simms, said: "Carillion made further significant
progress with its strategy to deliver good quality earnings growth by
developing its activities in private finance, support services and infrastructure
management, while maintaining a selective approach to traditional construction
and implementing prudent financial and risk management processes."
Looking forward, Simms said the group's strategic progress is also reflected
in the growing quality of its order book, which by the end of June was
£2.5bn, some £500m higher than at the same time the previous
year. This increase was due to major new orders in the group's growth
segments that more than offset a further reduction in orders for traditional
contracting.
The company’s railway division secured a £200m order from Railtrack,
and a five-year facilities management contract, worth £500m, was
signed with British Telecom to look after its 8,500 properties across
the country (see news story). A further
£450m was secured by Carillion through PFI, including the new GCHQ
building.
The company claims to be the market leader for such projects, being shortlisted
for 17 others as well as preferred bidder for the £30m contract
for the Magistrates Courts complex in Manchester. The only setback seems
to be the £25m charge to cover losses at Crown House Engineering,
where loss-making contracts were discovered last month (see
news story).
