UK contractor secures three contracts in northern region of Kurdistan – and boasts a pre-tax profit of £8.1m
Costain said this week that its strategy of pitching for work in northern Iraq was paying dividends, despite the continuing security fears in the country.
The firm pointed to three contracts won in Kurdistan. These are: for masterplans across the region; the design, construction and equipping of a medical laboratory; and commercial support for Erbil Airport.
The firm said that it was in the process of closing three more deals to supply project management and engineering services to the Kurdish regional government.
Costain has appointed Gary Wells to a new post of regional director for the Middle East and has set up a regional headquarters in Dubai.
Stuart Doughty, Costain’s chief executive, said the firm was taking great care over how it operated.
He said it had not had any payment problems as yet. He said: “We are paid in cash.”
Doughty made his comments as the firm posted impressive results for the half year to 30 June. Pre-tax profit rose a third to £8.1m and turnover grew 15% to £340m.
We have not had any payment problems. We are paid in cash
Doughty said the firm’s intention to restructure its balance sheet in order to offer shareholders a dividend by the end of this year was proving problematic, but would not affect year-end results. He said: “It’s an extremely difficult legal process we are going through.”
The firm’s international division aims to increase its worldwide presence in the marine market. The company signed an alliance with marine firm China Harbour in April and has prequalified for four schemes in Morocco, Mexico, Qatar and Nigeria.
Costain’s prospects were boosted by two major framework agreements in the UK with Thames Water and Yorkshire Water, which will be worth £350m over the next five years. The firm will carry out Yorkshire Water’s capital works programme in a joint venture with Haswell Consulting Engineers. It will also work on improvements to London’s water supply for Thames Water.
Doughty said that these framework agreements would help realise the firm’s ambition of deriving half of its turnover from its asset management division, which includes water and utilities work.
The firm said its UK building division was in talks over £350m of work. These include housing, retail and office contracts.