Bam makes £330m profit and praises HBG UK's contribution

Royal Bam, the Dutch construction conglomerate, has announced a doubling of profit to £330m and in its construction division, the group singles out HBG UK as having made “an excellent contribution”.

Bam’s turnover in the 12 months to 31 December 2007 was £7.0bn (figure in the previous year: £6.8bn). The group’s orderbook stands at £11bn.

In construction, there was a turnover of £3.0bn and a profit of £69m, a vast improvement over the previous period when construction operations ran up a £31m loss.

The turnaround is explained as being “partly due to the recovery of results in Germany”.

The rise in turnover is put down to a large increase in demand in the UK, backed up by smaller increases in Holland, Belgium and Germany.

HBG UK achieved a better performance despite pressure on margins resulting from increased sub-contractor and supplier prices. Bam takes the view that prospects in the British non-residential construction market remain favourable, partly due to the large number of projects either planned or in the construction phase, including work in the educational and healthcare sectors.

But Bam is concerned that increased economic uncertainty in the UK may result in a temporary slowdown in private sector awards.

In Bam’s civil engineering division, Nuttall had “a good year”.

In Bam’s public-private partnerships division, turnover of £57m triggered a profit of £23m. The margin of 40% is much higher than the 3% achieved in the previous 12 months.