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Pursuit of PFI projects set to cost Laing œ5m this year says Sir Martin - Laing hits turnover target
00:00 28 May 1997
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Laing's infrastructure investment in the last five months:
l the first share dealings in YTL Power International, which took place on the Kuala Lumpur Stock Exchange last week. Swapping its investment in YTL Power for shares in YTL Power International yielded Laing a profit of œ6 m;
l the consortium in which Laing has a 26 per cent interest secured the 18-year franchise for the operation and extension of the Manchester Metro system;
l Birmingham Airport Holdings has acquired Eurohub (Birmingham) and Laing has sold its investment at a œ2.8 million profit;
l the Spanish motorway Eurovias, in which Laing has a 13 per cent interest, paid its first dividend. The concession has 19 more years to run. Laing's construction division has already secured 97 per cent of its anticipated 1997 turnover, chairman Sir Martin Laing said last week.
Speaking at Laing's annual general meeting, Sir Martin listed Laing's top four recent major awards as Cardiff Arms Park (œ100 million), Manchester Metro (œ46 million), Rockwell Centre in the Philippines (a œ140 million joint venture) and NEC Phase 3 (œ52 million).
In a update on Laing's troubled M25 contract (CJ 15 Jan issue reported the company to be claiming an additional œ45 million costs plus œ7 million in penalty charges), Sir Martin said the project is now complete. The site was finally cleared on 5 March, some 21 months late.
"We are pursuing our entitlements," Sir Martin added.
1997 has got off to a promising start, he said, citing progress in a number of areas (see box).
The cost of pursuing Private Finance Initiative projects will cost Laing œ5 million this year, more than double the 1996 figure of œ2.3 million. This money is being written off, said Sir Martin, adding that the effect of this would be dependant on Laing winning the contracts.
Turning to other divisions within Laing's business, Sir Martin said: "Homes is benefiting from the stronger market in the South East and land that has the potential to generate good margins has been secured to maintain our two years' landbank.
"The recovery in the South East has still to reach the Midlands and Scottish markets.
"In the United States, good progress is being made in an improving market in California that should enable an Initial Public Offering during the course of 1998 - subject, obviously, to market conditions."
He said that the favourable cash position at December 1996 has not, as expected, been sustained, "mainly due to the planned expenditure on land for housing."
l the first share dealings in YTL Power International, which took place on the Kuala Lumpur Stock Exchange last week. Swapping its investment in YTL Power for shares in YTL Power International yielded Laing a profit of œ6 m;
l the consortium in which Laing has a 26 per cent interest secured the 18-year franchise for the operation and extension of the Manchester Metro system;
l Birmingham Airport Holdings has acquired Eurohub (Birmingham) and Laing has sold its investment at a œ2.8 million profit;
l the Spanish motorway Eurovias, in which Laing has a 13 per cent interest, paid its first dividend. The concession has 19 more years to run. Laing's construction division has already secured 97 per cent of its anticipated 1997 turnover, chairman Sir Martin Laing said last week.
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Speaking at Laing's annual general meeting, Sir Martin listed Laing's top four recent major awards as Cardiff Arms Park (œ100 million), Manchester Metro (œ46 million), Rockwell Centre in the Philippines (a œ140 million joint venture) and NEC Phase 3 (œ52 million).
In a update on Laing's troubled M25 contract (CJ 15 Jan issue reported the company to be claiming an additional œ45 million costs plus œ7 million in penalty charges), Sir Martin said the project is now complete. The site was finally cleared on 5 March, some 21 months late.
"We are pursuing our entitlements," Sir Martin added.
1997 has got off to a promising start, he said, citing progress in a number of areas (see box).
The cost of pursuing Private Finance Initiative projects will cost Laing œ5 million this year, more than double the 1996 figure of œ2.3 million. This money is being written off, said Sir Martin, adding that the effect of this would be dependant on Laing winning the contracts.
Turning to other divisions within Laing's business, Sir Martin said: "Homes is benefiting from the stronger market in the South East and land that has the potential to generate good margins has been secured to maintain our two years' landbank.
"The recovery in the South East has still to reach the Midlands and Scottish markets.
"In the United States, good progress is being made in an improving market in California that should enable an Initial Public Offering during the course of 1998 - subject, obviously, to market conditions."
He said that the favourable cash position at December 1996 has not, as expected, been sustained, "mainly due to the planned expenditure on land for housing."
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