NG Bailey strategy boosts annual operating profits

NG Bailey, contractor
A strong result for NG Bailey — chief executive David Hurcombe.

NG Bailey, which offers engineering, IT and facilities services, has reported a 43% rise in underlying profit to £3 million for the year to 27 February 2015. This growth in operating profit was achieved against the background of an investment of £2.7 million in new services and is underpinned by the company’s strategic goal to create a more diversified business that is much less dependent on traditional building construction work

The long-term strategy places greater emphasis on services such as IT, energy and facilities management. There is also an emphasis on engineering construction, particularly large infrastructure projects.

The diversification strategy saw a 20% growth in sales within the services businesses — including a 28% increase in facilities services and a 7% increase in IT services. Sales in building construction declined by 16%. Overall sales fell slightly — by 4% to £365 million.

During the period, the company’s secured order book increased form £550 million to £590 million. The company was also named as preferred bidder on a further £140 million of work — taking its forward-order book at year end to a record £730 million.

Chief executive David Hurcomb, said, ‘This is a strong result. We are all aware the economic environment is improving, but we also know that it is taking a long time to filter through to our industry.

It’s still tough out there, particularly in building construction. Margins remain under pressure across the supply chain, which is why we seek to avoid bidding for high-risk low-margin work.

‘We firmly believe our strategy of creating a much more broadly balanced business is the right one. We remain committed to growing each and every part of our business, which includes the work we do in the traditional building construction market. This is what our business was built on when the company was founded in 1921, and it will remain a core part of our business moving forward.’

Chairman Kevin Whiteman, adds, ‘We continue to invest in the business, including £3 million a year on the training and development of our 2500 strong workforce, as well as the £2.7 million we invested in new services.’

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