Chairman Sir Neville Simms said the company would build on its £500m contract to manage BT’s estate for five years. He said the contractor’s order book consisted of 75% services work and 25% contracting.
He said: “You only have to look at Lloyds Bank, the BBC and BT to see that there are more and more corporate bodies wanting their estates run differently. We are positioning ourselves for that market. We think the market for this is huge.”
Sir Neville denied that this focus on private sector PFI work implied that the group would switch over to a support services listing on the stock exchange.
He said: “We just want the support services part of the group to be valued properly so that it is more visible. We still see the important role of construction activity as part of our service.”
The contractor’s loss follows its decision to cut 900 jobs at Crown House Engineering, its ailing mechanical and electrical subsidiary.
Sir Neville said Carillion was getting over this debacle.
He said: “We have flailed ourselves with birch twigs and feel better about it. If you look at the year-end results without Crown House, you will see a satisfactory step forward.”
Carillion’s plans do not include becoming part of the industry’s consolidation drive, Sir Neville said, despite rumours circulating over the summer that it would be snapped up by the Swedish contractor Skanska.
He said: “Consolidation is not an issue for Carillion. It has a clear path as to what it wants to do. Consolidation may well continue with smaller players.”
PFI work almost trebled its contribution to Carillion’s total turnover. It rose to £126m for the six months to 30 June. The turnover for the whole group rose 6% to £926m.
Sir Neville said the new focus on PFI and services projects would lead to a drop in traditional construction work and civil engineering in the UK.
Building work fell 8% to £327m for the half year. Operating profit increased 22% to £6m, which Sir Neville said was the result of larger contracts for long-term customers.
