Wescol in 'best position'

Wescol, the structural steelwork specialist subcontractor, has a current orderbook worth £40 million. Stephen Brown, finance director, said this was "the best position we've ever had." He sees no sign of a downturn in demand.

The quality of Wescol's workload is also holding up. Having raised operating margins during the last financial year (12 months to 31 July 1998) from 5 to 6 per cent, Wescol is finding itself able to sustain the higher figure.

"We're not seeing any signs of a drop in volume in the current year and I'm happy with the prices we're winning work at," he said. "We're still at the 6 per cent operating margin.

"You can put that down to buying efficiency, better productivity and the fact that we're now winning a bigger range of contracts."

Wescol's largest schemes at the moment are the £7 million stand for Newcastle United, three multi-screen cinema projects worth a total of £8 million, and a £3 million glass factory scheme. Typically, Wescol's steelwork contracts are in the range £1.5-£2 million.

Wescol's annual turnover almost doubled to £74 million (£38 million), partly as a result of last year's acquisition of Glosford Holdings. Pre-tax profit jumped to £4.4 million (£1.9 million).

Wescol is the UK's third largest structural steelwork group, ranking after Severfield Reeve and William Hare.

Alan Walker, md, said that Wescol was involved in more schemes at an earlier stage, enabling it to work to client's instructions. "It is a result of the increasing trend towards construction management," he said.

"On projects where there is no main contractor, work is divided into works packages. This trend excites us as we believe that the more management responsibility you take, the better the reward and the less competition as there are fewer people willing to undertake such projects."

Wescol is currently involved in two such schemes, both distribution warehouses - one for Carlsberg Tetley, the other for Iceland Frozen Foods at Enfield.

"Both schemes are through construction management - unlike main contractors they have no benefit in screwing the subcontractor. As a priority, they want a troublefree project, whereas a main contractor is driven, to some extent, by greed."

While Wescol's policy is to work with all main contractors, there are companies it prefers to link up with. Walker singled out Birse, Ballast Wiltshier and Bovis as three main contractors where working relationships are particularly good.