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Return to profit in the air for McAlpine

Finance McAlpine's contracting profits rise again as new wind energy operation takes off

SIR ROBERT McAlpine's contracting operation has returned to profit despite a slump in turnover.

The business made a £3.1 million operating profit in the year to October 31 2001 against a £427,000 deficit in 2000 but turnover crashed £82.1 million to £494.4 million.

Group turnover rose to £756.6 million from £654.2 million and pre-tax profits soared to £17.4 from £4.3 million in 2000 as McAlpine's new wind energy business took off. But profits from Private Finance Initiative work fell as costs escalated on a £76 million hospital concession in Dudley that Summit Healthcare, a consortium comprising McAlpine and Interserve, closed in May 2001. The firm said: 'This was due to start-up losses on the investment being greater than the increase in the profits of the other PFI investments collectively.'

Turnover at the PFI division rose to £15.8 million from £13.3 million but operating profits fell £800,000 to £1.8 million.

Property turnover doubled to £14 million and provided operating profits of £1.3 million against £393,000 in 2000, but the best results came from the wind energy operation, RES, which completed a major wind farm in Texas.

Operating profits flew up to £9.5 million from £1.3 million with turnover surging to £196.2 million from just £32 million in 2000.

The windfarm work provided most of the firm's US turnover, which leapt from just £6.5 million in 2000 to £189.9 million. The fall in contracting work resulted in a drop in UK turnover to £529.7 million from £612 million in 2000.

McAlpine made a one-off profit of £7.1 million from the sale of its stake in fit-out contractor Interior but was forced to write off £6.4 million from other un-named investments.