Demolition specialist Keltbray has reported record results for 2013 as it becomes “more selective” on jobs.
The firm announced a 15 per cent increase in turnover to £145m for the financial year ending 31 October 2013, the best performance in its 38-year history and up from £126m the previous year.
Gross profits increased by 20 per cent, with operating profit remaining stable at £2.6m. The group’s cash position also improved, to £4m.
Keltbray financial director John Keehan said the bulk of the firm’s commercial work was coming from London and the South-east, with the company seeing a “good increase in volume this year”.
He told Construction News: “We are being more selective now. We don’t want to over-extend ourselves and find we can’t provide the right service to our clients.”
Keltbray Group is split into three reporting streams: demolition and civil engineering; environmental materials management; and rail.
The rail division recorded the biggest percentage growth over the period, with turnover growing by 24 per cent to stand at £44m.
Mr Keehan said: “Demolition and civils remains a bigger business, but we have good opportunities in rail which will grow, especially with the frameworks we’re on.
“We moved into rail a few years ago as there’s a lot of civil engineering there. There are high barriers to entry due to health and safety, and projects are complex – and that’s one of our USPs.”
Mr Keehan said margins were “slightly better” than this time last year, but that most of the gross profit increase was “volume-driven”.
He added that, as the upturn looks increasingly sustainable, he hoped that “prices keep moving up”, but that skills remained a challenge.
He said: “We’ve got to move our prices, as materials prices are going up and labour prices will go up as that resource reduces. We have to keep our prices going up to maintain our margins.
“Some of our businesses are going overseas to get people – especially some of the design areas, where the design capacity isn’t adequate for the demand of work coming through.”
The group’s demolition and civil engineering division, which covers around 66 per cent of Keltbray’s business and includes piling, asbestos management, engineering design consultancy and haulage and plant, increased turnover by 12 per cent.
Large projects for the group in the past year have included work on the Heygate Estate in London for Lend Lease, as well as a large residential development for Qatari Diar at Chelsea Barracks.