First the share collapse and now the question mark over rail work after Hatfield … Can the market's former darling pull Jarvis back from the brink?
last week's Hatfield train crash put rail contractors under the spotlight. Balfour Beatty, which was responsible for maintenance on the stretch of line where the tragedy happened, drew most of the attention, but some fell on Jarvis, which as renewal contractor was due to replace the broken track. Although Jarvis is in no way implicated in the latest fatal accident, its performance is more closely associated to the fortunes of Railtrack than any other construction firm.

This is partly because of the sheer amount of rail work it does – its infrastructure arm accounted for nearly 70% of the business for the year to 31 March 1999. But it is also because that work is done for a single client which is the subject of intense political, media and financial scrutiny. If Railtrack sneezes, Jarvis contracts the plague. This was underlined last year when a dispute over maintenance and renewal contracts led to a 35% collapse in Jarvis' share price.

Between 1994 and summer 1998, Jarvis' market capitalisation had gone from £3.6m to £1bn but that spat seemed to mark the end of the affair as far as the City was concerned. One analyst compared its stock unpredictability to the internet sector.

Further signs of Jarvis' malaise have since become evident. There were high-profile departures – rail projects manager David Anderson, traffic systems chief Andrew Gay and public relations director Keith Lockwood all left this year – and there was an embarrassing row with auditor Pricewaterhouse Coopers over a £15m sum that Jarvis wanted to count as profit. This ended in defeat for Jarvis in the High Court this summer, when it was ordered to pay undisclosed indemnity costs to its accountant.

All of this ought to be a headache for Jarvis' suave chief executive, Paris Moayedi. If it is, he hides it well. Perched on a leather couch in his firm's snug Piccadilly flat, 61-year-old Moayedi is in philosophical mood. "I think we are going through a period where fluctuations in the market are greater than we have ever experienced," he opines. "At the end of the day, providing the company keeps delivering we can ride the ebbs and flow of the market."

But surely his problems are more specific than that. Above all, there must be uncertainty about the long-term future of infrastructure suppliers, given Railtrack chief executive Gerald Corbett's call for a wholesale shake-up of the rail industry. One worst case scenario is that Railtrack could bring maintenance and renewal work in-house.

Moayedi will not comment on this, but is bullish about Jarvis' prospects in the rail sector. He sees the relationship between Railtrack and Jarvis maturing. "Railtrack has brought in E

E some top operators and I am hoping that the improvement in their performance will continue," he says. A sign of that maturity, Moayedi argues, is that Jarvis' contracts have shifted from high risk, high margin to the opposite. "We are accepting a much lower return but we are sharing the risk with Railtrack. We are pulling together."

On safety, Moayedi is definite. "The contracts between ourselves and Railtrack put safety at the top of the agenda." While acknowledging that there is room for improvement, Moayedi believes performance is on an upward curve. "The safety record of railways is improving despite the additional traffic," he adds.

The immediate aftermath of the train crash actually saw Jarvis' shares rise 10%, on market expectations of an increase in renewal work. But how does Moayedi explain the overall decline in Jarvis' share price? Moayedi puts it down to difficulties communicating with the City. "There have been problems with public relations and investor relations. I intend to put those right," he declares. "The fundamentals of our business are sound."

Moayedi cites Jarvis' concentration on niche markets as proof that he still has a viable strategy in place. Road and rail infrastructure work and PFI schools projects are the key areas for growth in government spending, and not just in the UK. Moayedi is eyeing up growth in those sectors in Europe and the rest of the world as well. "The last year or two have been a period of consolidation. We are now ready for the next phase of expansion."

What about the personnel problems that have dogged the firm? This is a result of growth, Moayedi argues. Since 1995, Jarvis' workforce has increased by 200 to 8000. "I would be a miracle worker if I could increase the number without some leaving," he says, adding that departures are inevitable because businesses and people change so fast.

The idea that he might himself be one of the next high-profile departures inspires hearty laughter. "So you want to know when I am buggering off," he says, before trotting out the party line and stressing the strength of his management team. "When I or my board decide it's the right time for me to leave, then we will make sure we have the right people to follow. There is ample experience within the company and a huge market outside."

Yet doubts persist that Moayedi tends to overpower talent rather than nurturing it. One analyst said the impression created is that of a one-man band. Past colleagues go as far as to call him a control freak – which he goes some way to accept.

"I could be accused of that. I have to know what's happening. It may well be it's not a good characteristic." Moayedi adds, however, that some of his workforce welcome his eye for detail. "Some employees like it if I know what they are doing. It shows I care. If I know they have done a fantastic job, then I can tell them." And if mistakes are made? Moayedi chuckles: "That's a bit more uncomfortable."

Work has its stresses, especially when you are as hands-on as Moayedi. "There is always a certain amount of antagonism towards individuals that have made it in business, which doesn't seem to tar sportsmen or actors," he says. But he adds: "I am not complaining, though; I love it."

And the money's not bad either, despite Jarvis' depleted share price. His 2.7% stake is worth about £5.6m. The figure was nearer £20m a couple of years ago, but Moayedi says this is not a big concern: "Life is about doing something worthwhile. Making money is a byproduct."

Personal effects

How do you travel?
By train, car and plane. I travel frequently to York, Manchester and Leeds by train. The train is excellent, aggro-free and safer, despite the recent tragic accident. Who is your business guru or hero?
I always look to my father, who was a lawyer. What are you reading?
A Woody Allen book. It’s very funny. Usually I read more serious books. My favourite authors are Albert Camus and John Paul Sartre. So are you an existentialist?
I was interested in it. In your formative years, what you read forms the basis of your character. I certainly think there is no greater injustice to nature or your creator than a wasted life, which fits in with existentialism. What about music?
I always listen to music when I’m reading. I love pop music. I have very catholic tastes. I recently bought CDs by American band Lone Star and blues legend Howlin’ Wolf. What was the construction job you most enjoyed?
It was in my mid-20s, taking charge of the rebuilding of a Kelloggs factory in Trafford Park that had been largely destroyed by a fire. We had to do the work while the factory was still working.