Laing O’Rourke betters profit by £10m

Laing O’Rourke’s pre-tax profit has jumped to £34m, a rise of £10m over the figure achieved in the previous year. Latest annual results (12 months to 31 March) show turn-over well ahead at £2.3bn (previous year: £1.9bn).

Ray O’Rourke, chairman, said: “We are doing traditional things in a modern way – offering a vertically integrated total construction and development solution, delivered by a directly employed workforce.

“For years, construction has faced an inexorable decline in traditional trades. We have set out to change this by investing heavily in improving the status of our site management and leadership. “We are adopting methodologies from other industries. By utilising modern construction approaches, such as off-site manufacturing and multi-skilling our teams, the group is transforming the way projects are delivered.”

Operations are now organised across three international business hubs: Europe (including the UK); Asia and the Middle East; and Australia. Since the financial year-end, O’Rourke’s fire power in the latter region has been boosted by its £30m acquisition of Mowlem’s former Australian division, Barclay Mowlem.

O’Rourke’s highest-paid director received £404,000. The group’s number of employees rose to 22,500 with the average pay running to £24,300 a year. Shareholders withdrew a total dividend of £7m, well down on the previous year’s harvest of £19m. On average, each employee had a contribution from the company of £510 towards their pension. Subcontractor retentions were more than double at £7.8m (previous year: £3.7m)

The group’s ultimate parent, based in the British Virgin Islands, is Suffolk Partners. Its beneficiaries are Ray O’Rourke and his two deputy chairmen, Des O’Rourke and Bernard Dempsey. In the UK, Laing O’Rourke has created Construction North by amalgamating the building operations of the northern, north Midlands, Scottish and Irish businesses. The new headquarters is in Birley Fields, Manchester.

Construction South is the result of bringing together the former building operations of London and the South East, Wales and the west of England, south Midlands (south of Birmingham) and East Anglia. The London 2012 Olympics are seen as likely to give the division’s future workload a boost.

In India, Eigen has “grown exponentially” and now has offices in Delhi and Mumbai. Formerly known as Laing O’Rourke Technical Services, it provides structural and M&E detailing and design as well as IT and back-office support to the group’s construction operations.

[Contract Journal, 11 October 2006, p 1]