Connaught enjoys rise in pre-tax profit to £22m

Connaught has unveiled a pre-tax profit of £22m on the back of turnover running to £550m.

The group’s figures cover the 12 months to 31 August 2008.

The last time round, Connaught’s turnover of £400m generated a profit of £16m.

Segmental analysis shows turnover contributions from the group’s two operating divisions were:

• £450m – social housing
• £110m – compliance

Their contribution towards the group’s pre-tax profit, before allocation of £6m-worth of central costs, was:

• £19m – social housing
• £9m – compliance

Connaught provided its shareholders with a £3m dividend, up from £2m in 2007.

Mark Tincknell, chairman, said: “I am delighted to announce another set of strong results. We have built a strong and balanced business in two growth markets with defensive characteristics and robust cash generative qualities.

“Both the social housing and compliance markets are underpinned by essential and non-discretionary expenditure.

“They remain fragmented, providing the group with opportunities for further organic and acquisition growth.”

Tincknell said that the social housing maintenance market is worth a total of £11bn a year.

“There is expected to be an ever-increasing demand for affordable housing – there are currently over five million households in social housing with over 1.6m on waiting lists, the highest level for two decades,” he reported.

He said the top 10 players in this fragmented market share only 21% of the total spend.

In compliance, Connaught made three acquisitions. The value of the market is put at £6bn and is growing at around 6% a year.

It is also fragmented, with the top 10 players share running to just 15%.

The regulatory environment, driven by increasing level of EU health and safety legislation, is holding businesses and company directors to account,” said Tincknell.