Morgan said the group needed to integrate the three purchases it made in 2001 before looking for further acquisitions. He said: “We had a busy year last year and we couldn’t keep that up even if we wanted to. While you can never say never, we’re going to be very boring this year.”
Morgan Sindall last year added Carillion’s social housing business to its affordable housing arm. It also established an infrastructure division, Morgan Est, after acquiring Miller’s civil engineering arm and Pipeline Constructors. The group spent £42.7m on the acquisitions last year.
Morgan said the group was now established in its four target markets: social housing, civil engineering, regional construction and fit-out. He said: “Last year was important to us because, thanks to the buys, we are now in the four markets we want. This year will be about building on all of that.”
Morgan was commenting as the group posted a record profit for the seventh consecutive year.
Pre-tax profit jumped 35% to £20.8m in the year to 31 December compared with 2000. Turnover has increased 39% from £655m in 2000 to £909m. The order booked topped £1bn for the first time. Morgan said building his firm’s public sector work through last year’s acquisitions had been important.
“All three acquisitions were aimed at increasing our public sector work which is more stable and vibrant than the private sector.”
The regional contracting division, now called Bluestone, continued to struggle last year. Operating profit fell £500,000 to £4m, compared with 2000, even though turnover rose from £318m to £403m. Margins are 1%.
Morgan Sindall has axed the six regional brands to create the single national Bluestone name in an attempt to improve performance.
Morgan said: “We bought some loss-making regional contracting businesses and ran them as separate companies.
“The margins haven’t improved enough so we are bringing them all together.”