Sanity over Vanity
The nation might be in the icy grip of the “Beast from the East” but the UK construction industry has a warm glow about it thanks to another positive month on the BCLive league table. The Builders’ Conference CEO Neil Edwards looks through the blizzard to analyse the figures.
February is the shortest month of the year. Notwithstanding the icy blast that has blown in from Russia bringing roads, rail networks and airports to a standstill, it is generally the coldest month of the year. And while new construction starts are often held over for a January start, February normally brings with it an industry-wide lull.
But, in typically contrarian fashion, the UK construction industry has no truck with such concerns and traditions and has – once again – delivered a stellar performance on new contract awards that have taken the BCLive league table over the £4 billion monthly total yet again.
Scaling the snowy peak to plant its flag at the top of the BCLive league table for the second successive month is Kier Group which collected 11 new contract awards worth a combined value of £304.3 million. The largest of these is a £180 million refurbishment and repair contract on the M6.
BAM could (and possibly still might) have actually topped the tree this month. It claimed second spot with as part of a £300 million joint venture with Morgan Sindall for the Smart Motorway refurbishment and repair contract on Junctions 4 to 11 on the M27 in Hampshire; but it is not yet clear how that £300 million will be divided between the two joint venture partners. BAM also claimed third spot independently, picking up three new contract awards worth a combined total of £265 million. The most notable of these is a £100 million new build mixed-use development at Atlantic Square in Glasgow for client Taylor Clark Properties.
The BCLive league table recorded more than 300 companies winning new work in the month of February. As has become the norm, Greater London was yet again the busiest region, generating just over £1 billion in new contract awards. Equally predictably, housing was the busiest sector. However, it is notable that infrastructure – a combination of roads, rail and airports – generated more than £625 million in new contract awards.
In a month in which the Top 11 companies on the BCLive league table each bagged more than £100 million worth of new work, it is notable that a number of them did so with multiple contract awards. Galliford Try claimed seven new contract awards to take the number four spot; Willmott Dixon took fifth spot with nine awards; and ISG compiled 10 new contract awards to take the number seven spot. Even Morgan Sindall which narrowly missed out on a Top 10 finish collected 10 new contract awards worth a combined £95.5 million that took it to number 12 on the table.
When work is hard to come by, multiple contract awards often suggest a degree of desperation; a focus on turnover to keep the company wheels turning. That does not seem to be the case this month. In a post-Carillion world, we are receiving reports of companies actively walking away from contracts that do not fit their remit or their profitability profile.
Quite how long such a strategy will last remains to be seen. But a switch from the vanity of turnover to the sanity of profit is surely to be welcomed and applauded.
Quick review of BCLive table for February 2018
- 35no companies were detailed as winning new contracts during January 2017
- 502no new construction orders are detailed on BCLive
- Kier Group secure overall top spot with £304.3 million of new work
- New order winners in £1M to £5M category was Engie UK a regeneration company based across the UK & the £1M and under category went to Clark Contracts from Renfrewshire in Scotland
- Kier Group also secured the most number of new construction orders in the month with 11no
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