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Scaffolding

The top 10 scaffolding companies have remained relatively stable over the past year, with overall combined turnover up 6.4 per cent to £825 million according to their latest financial results.

Profits were more variable. Brogan Group managed to turn a pre-tax loss into a pre-tax profit this year, which company director Giles Williamson puts down to strategic business relationships.

Click on table to enlarge

Top 10 scaffolding

“The increase can be attributed to an increased emphasis on partnering with key clients, resulting in better planned access solutions and ‘buy-in’ from other specialists,” he says.

He also points out that figures don’t always tell the full story. “While we did increase our profitability, the previous year was profitable also, though the bottom line was affected by a one-off exceptional, which was the write-down in value of property,” he says.

Trad’s latest figures show a pre-tax profit rise from £1m to £3.5m over the course of a year.

“The latest profit was exceptional because of an insurance claim pay out in the year,” says Trad Scaffolding group managing director Des Moore.

“We have not improved profitability by nearly four-fold; it was an exceptional item.”

The real picture for his company and other scaffolding contractors, Mr Moore says, is less positive.

“I think it’s probably true across the board that margins are under pressure and you’ve got problems with skilled labour leaving the industry and young people not being attracted to join it.”

Both Mr Williamson and Mr Moore consider the ongoing reduction in general construction activity as a major challenge facing scaffolding contractors.

“This is fuelled by the lack of confidence of private investors and the climate of austerity,” says Mr Williamson.

“To address this we need more government and private sector investment in construction.”

National Access and Scaffolding Confederation managing director Robin James agrees, adding: “[The challenges are] linked to the bigger picture with principal contractors and the fact that the whole construction market has contracted.”

Mr Williamson says that Brogan Group is looking at diversification as well as repeat business as bright spots for the future.

“Brogan Group has a 95 per cent repeat business rate and we use our service and health and safety record as a platform for gaining new clients,” he says.

“More generally, in the medium term we are hoping to achieve further growth through increased diversification, particularly into rail and infrastructure.”

Mr Moore is less optimistic about short-term growth. “Future growth will only come from a return in the commercial market - that’s a key factor,” he says.

“It’s been at a fairly low level for the past four or five years and I don’t think it’ll recover for at least another two - that’s the message coming from our clients.”

Geographically, London might offer contractors some hope in the coming months, particularly once the Olympics are over.

“There could be a spike in the London market, as there is work that has been put on hold because of the Olympics - work which will take place in the last quarter of this year or early next year,” says Mr Moore.

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