T Clarke reports pressure on margins

T Clarke, the electrical contractor, has reported that margins in 2005 were under extreme pressure, adding that they are “slow to show improvement”.

Expanding on the prospects for 2006, T Clarke’s chief executive Pat Stanborough said: “We are confident of better returns in the short-term. Local authority, residential and education continue to provide steady growth for our regional businesses along with growing potential for an entry into commercial development in city centres.”

T Clarke’s financial results (12 months to 31 December 2005) show a jump in turnover to £190m (£160m). Stripping out the contribution from the group’s acquisitions during 2005, the existing divisions lifted their workload by 13%.

Last year, Smith Contracting Services was bought for £4.1m. It now trades as SCS Building Services. A further £1.7m was spent on the acquisition of Waldon Electrical Contractors. They have extended Clarke’s regional coverage, into Scotland and south west England respectively.

Pre-tax profit was higher at £8.6m (£7.8m) though the latest figure is inflated by £1m thanks to the exceptional profit of £1m resulting from property disposals. Without this, the profit would have been 3% down – a “satisfactory achievement in difficult circumstances” said Stanborough.

The forward orderbook has risen to £170m (£130m) thanks to greater demand in the regions.

All the businesses outside Clarke’s core activities in London have been brought together under a regional board. Stanborough said: “This has resulted in a simplified structure with shorter lines of communication between our businesses and the board.”

Recent contracts wins include 201 Bishopsgate & Broadgate Tower; 02 Millennium Dome; Warrington bus terminal; and the River Usk bridge at Newport.