Adrian Ewer, chief executive of PPP specialist John Laing, has said it has had difficulty raising equity for its investments during the downturn
The firm, which operates in the PPP markets in education, social housing, health and rail made a pre-tax profit of £18.3m over the 12 months to 31 December 2009, compared with a figure of £43.6m last year. The value of its PPP portfolio on 31 December 2009 was £653m, down 6% on the figure of £698m in 2008.
In the annual report of the PPP specialist, Ewer said: “Prior to the financial crisis, it was a reasonable assumption to make that the company would be able to attract increasing amounts of equity funding. This would have been applied to develop and hold infrastructure assets to their full maturity, either on the company’s balance sheet or through managed funds. The raising of additional equity has proved difficult, but the directors have determined that the company should continue to press for growth in the portfolio of projects under development.”
The company, which is owned by the private equity arm of fund manager Henderson, raised £120m in 2009 to fund this growth through the sale of its interests in PPP assets. This resulted in a £15.7m hit to the balance sheet because values were below their peak.
Laing left the contracting market in 2001 when it sold its construction business to O’Rourke.