Mace will shoot up the next CN100 list by bringing in £950 million of revenue by the end of 2011, its chief executive told CN today.
Stephen Pycroft also confirmed this afternoon that he will stand down as chief executive in 2013, but continue in his role as chairman.
Reporting annual results to 31 December 2010 this morning, the firm said it is ‘on track’ to become a £1 billion turnover company by the end of 2012, and also expects to have increased its 2010 market share by 50 per cent under a five-year strategy. The company is also planning to move into a new headquarters in the City next year.
“The expectancy is that Mace will do £950m in 2011,” Mr Pycroft told CN.
“Internally in Mace we always feel that we can do better. We know that big is not best, but there is no doubt that if you are going to do the major projects, that you have to have the balance sheet and the profile. We see £1bn as a watershed.”
The privately-owned firm has risen one place in this year’s CN100 table, out today, after revealing a 17 per cent hike in revenue to £851m in 2010 and pre tax profit up nine per cent to £21m.
Mr Pycroft confirmed that Mark Reynolds, who has been deputy chief executive since 2009 and was part of the CLM delivery partner consortium team that secured the London Olympics and Paralympics, will take over the chief executive role.
“The succession plan for Mace is already in place; in 2013, Mark Reynolds will take up the reins as the chief executive of the business.”
Construction made up three quarters of the revenue in 2010, with consultancy generating £204m.
Mace’s profile was boosted when it landed the £426m deal to build the Shard skyscraper, after first being involved in a pre-construction and planning role, before being appointed project manager and then the lead construction firm.
Other contract wins in 2010 have included London Bridge Quarter, New Doha International Airport, Thames Water programme management and EDF Energy nuclear new build.
Mace, celebrating its 20th anniversary after it was founded by former Bovis man Ian Macpherson as a construction management company, forecasts £700m of construction revenue in 2011.
Mr Pycroft said: “I think 20 years ago, Ian Macpherson’s view would be that this would be a boutique construction management organisation.
“However, progressively over the years, as clients have demanded that Mace take on more services, the fact that our reputation has been enhanced by delivering great projects, and the way contracting has changed in the UK, have all led to Mace having a construction arm that delivers some 76 per cent of income now.”
Mr Pycroft said price still remains the priority for clients, but that the firm had also invested in bidding capabilities such as 3D modelling, building information modelling (BIM) and dedicated teams.
Mr Pycroft said Mace is intending to maintain its market share in London commercial – which accounts for between 50 and 60 per cent of revenue – while diversifying in other sectors, such as infrastructure.
In spite of a steady flow of Middle Eastern investment into London, Mr Pycroft said finance remains a problem for the industry.
“There is no doubt that the lack of finance and lack of bank lending is constraining the construction market, both in terms of commercial and residential.
“If we are going to maintain our growth while maintaining the commercial office market position in London, we have to diversify into other markets”.
Last year Mace also boosted its international presence from 49 countries to 65 – up from 36 countries in 2009 – and is forming a global services group this year to secure long-term global clients.