Kvaerner Construction’s third quarter results for the period to September 1999, announced today (Tuesday 16th November), show that increases in profit continue to exceed growth in turnover.
| Third Quarter | 9 months to 30 September | |
| Turnover | £ 334.6 million | £ 955.3 million |
| Operating profit | £ 6.0 million | £ 10.1 million |
| Profit before tax and goodwill | £ 8.6 million | £ 17.6 million |
| Order Book | £ 1.3 billion |
The results show a 1.8% margin on sales for the year to date compared with 1.3% at the end of the first quarter in March and 1.4% at the half year in June. Turnover for the third quarter was up by 3% at £334.6 million. The order book, at £1.3 billion, has reduced slightly in line with the company’s selective approach to tendering. Profit before tax and goodwill at £8.6 million in the third quarter takes the cumulative figure for the year to September to £17.6 million. Operating profit now stands at £10.1 million, up £6 million in the third quarter.
Chief executive Keith Clarke, said: “While our order book at the end of the third quarter stood at £1.3 billion, against £1.5 million at half year, our return on sales has again increased confirming that our focus on performance, and not on volume, is continuing to produce results. The markets world-wide are generally holding steady in volume and remain competitive, for example in Hong Kong, where Gammon Construction is selectively winning work with contracts worth more than £70 million in the third quarter. However, margins remain depressed.”
Overseas, Kvaerner Cementation India has completed a major jetty project for P&O and has been awarded the quality standard ISO 9002 for the construction of port and harbour structures, the first Indian contractor to achieve this. In Dubai, fit-out work for the spectacular Burj Al Arab hotel is completed in readiness for its December opening and in the USA, several new contracts have recently been awarded.
In the UK, the Dudley Southern Bypass has been finished five months ahead of schedule; work on CTRL Ashford is progressing steadily as well as on two smaller rail contracts and further work for Railtrack is anticipated.
During the last quarter Kvaerner Construction won its fifth and biggest design and build prison contract for a PFI prison development in East Staffordshire worth £69 million and its PFI team is working towards achieving financial closure for a major MOD contract in London.
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