Contractor Bovis generated more than half the profit of its Australian parent, developer Lend Lease, in the six months to 31 December
Globally, Bovis turned in an Aus$98.4m (£41.2m) pre-tax profit, a rise of 34% on the same period last year. In Europe its pre-tax profit rose 3% to Aus$53.6m (£22.4m). The Asia Pacific region returned to profit after making a loss.
John Spanswick, European chairman and chief executive of Bovis, said strong sector diversity had helped to boost profitability. “We have won a fair amount of work in the retail sector and the commercial office sector is showing signs of recovery.”
He said that a number of regular clients, including property companies Stanhope and Development Securities, had found the lettings market had improved and this had encouraged expansion.
He added that the government’s spending programme was encouraging. The work of the firm is split about 50–50 between the public and private sector; 50-60% of profit is generated from 15 clients.
Adrian Chamberlain, Lend Lease’s chief executive in the Europe, Middle East and Africa region, said: “For the fourth year in a row Bovis Lend Lease topped the league tables for new business won in Britain, with more than £2bn of new orders in 2004.” He said that Bovis was set to export its PFI skills to Italy and Spain.
Other Bovis highlights for the past six months included a five-year extension of its alliance with BP to build all its filling stations in 12 European countries and the US.
In addition it won a £120m urban regeneration project at Kings Waterfront in Liverpool, a £65m office development for Land Securities in Norwich, a £42m office development in the City of London for Pillar Property Investment and a £30m contract to construct the supporting deck for phase two at Paddington Central in London, above the proposed Crossrail route.
Bovis Lend Lease won more than £2bn of orders in the UK
It is also about to start work on a shopping centre in Warrington, Cheshire, in which Lend Lease has a 50% stake.
In the public sector, Bovis reached financial close on two PFI hospital schemes in Manchester and Leeds, and won its first big schools project in Scotland.
Spanswick said the project to redevelop the BBC’s Broadcasting House, in central London, was going well. Last week, Building published documents that revealed a bitter year-long battle between Bovis and Schal for the £400m contract.
Lend Lease said first-half profit after tax was hit by a Aus$50.8m (£21.2m) charge from restructuring and its failed Aus$7.2bn (£3bn) acquisition of General Property Trust.
As a result, overall profit dropped 32% to Aus$128.5m (£53.7m) in the first half.