Ennstone reports record interim profits for seventh consecutive year

Ennstone, the aggregates and building products group, has unveiled record interim profits for the seventh successive year.

“The big thing about us is that we now have a complete route to market,” said chief executive Vaughan McLeod. “We are putting our aggregates into asphalt and ready-mixed concrete, plus we now have a contracting arm to put our products onto roads.”

Ennstone’s interim results (six months to 30 June) show turnover higher at £100m (£80m) with pre-tax profit rising to £9.1m (£7.9m).

Ennstone trades in the UK, America and Poland.

In the group’s UK Aggregates division, strong price growth compensated for volume reductions, particularly following the completion of the major A92 contract in Scotland.

Ennstone Johnston won planning permission for two asphalt plants and three concrete plants, all in the Midlands.

In the UK Building Products division trading was difficult, especially in the second quarter as a result of pricing pressures and a drop in demand for some products.

Jackson Precast, bought in August, will improve coverage in the east Midlands region.

Ennstone is part of the Bear Scotland joint venture. It lost its existing highway maintenance contract in the north west region of Scotland, but McLeod is shedding few tears.

“Five years ago we were keen to get into this market to maintain volumes but when the new tender came up we’d changed quite a lot, today’s policy being to tender at prices we can make a return on,” said Vaughan.

Transerve, a jv between Balfour Beatty and Mouchel, won the new contract. “We’re disappointed but we believe we had the price right,” said Vaughan.

The operations in Poland have now moved into profit.

Ennstone’s net debt of £113m gives it a gearing (i.e. ratio of debt to equity) of 84%. At the start of the year the figure stood at 92%.

The group’s pension funds assets run to £44m, while liabilities are put at £58m.