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Costain energised by nuclear power jobs

FINANCE Helped by strong water results, resurgent contractor's profits grow by over a fifth

COSTAIN pointed to the prospect of a growing workload from the nuclear cleanup market and education last week when it reported results showing pre-tax profits up 21 per cent to £19.5 million.

The group increased turnover by 8 per cent to £703 million and highlighted a strong order book worth £1.1 billion, with a further £1 billion under negotiation.

The group said it had pre-qualified for schemes with nuclear bodies such as BNFL and the UK Atomic Energy Authority.

The firm has been shortlisted for the design of a cementitious plant for nuclear waste and has pre-qualified for the first substantial decommissioning project, worth over £150 million, for the new Nuclear Decommissioning Authority. Some Costain personnel have switched from its oil and gas design operation into its nuclear-related work.

The group has been recruiting staff in education, where it said it had seen considerable expenditure and was seeking to 'secure a dominant position' Costain has a significant share of the utilities'capital asset programmes.The firm has won a five-year contract from Thames Water, framework contracts from Yorkshire Water worth £180-200 million and is a preferred partner with Welsh Water. It is also part of a consortium that is preferred partner on Southern Water's £1.5 billion programme of works.

Chief executive Stuart Doughty (pictured) said the firm's strict adherence to a low risk strategy was producing a sustainable and robust profit stream while adhering to the core activity of contracting.

Costain's civils business won a series of major road schemes in south Wales including projects worth £94 million and its building arm has returned to profitability and increased turnover by 58 per cent to £225 million.

The firm has seen a slowing in hospital investment under the ProCure 21 approach. It has experienced a dip in growth in the commercial market although it is providing infrastructure for numerous house builders.

Following a restructuring of the balance sheet the group is set to resume payments of dividends.