Hoping to collect £35m from streetfighting years

Birse reports slow progress in settling 10 problem contracts, with a total contract value of £250 million, that were completed by the construction group in the early '90s.

"We're looking to get at least £35 million," said John Elders. "We've been made offers on all of them. They are all either in arbitration or going to the High Court but none of them are time-tabled to be settled before 30 April 2000 - the end of the current financial year."

In contrast to Birse's confrontational approach to winning work in the past, the group's high-profile culture change has led to a growing proportion of better quality workload - partnering/bidding in restricted competition now accounts for 75-80 per cent of turnover.

"When working on an open book basis, we can generally get a 7-8 per cent margin," said Elders. "Allowing 5 per cent for overheads, you hence get a net return of 2-3 per cent if the project goes to plan."

Birse is keen to be involved in Prime Contracting, either as leader of an alliance or by working in an alliance led by a consultant. "Prime Contracting is being developed all the time," said Elders. "It is a different way of doing business and it has got to be good.

"The client wants price certainty and a job finished on time. In return, he offers a decent level of profit and repeat business. That's the bargain. On the face of it we want to be a Prime Contractor, though our basic position is that we want to be where we can contribute big-style."

When Peter Birse was at the helm, Birse steered clear of PFI work. Peter Watson, the group's new chief executive, said: "We're on the verge of thinking of dipping our toe in the water." If that sounds like a cautious accountant speaking, that's because Watson is indeed an accountant.