Much to the displeasure of housebuilders, speculation about a housing crash has preoccupied the City and the media in recent weeks.
As the sector prepares for another turn in the market cycle, companies such as Berkeley are turning to regeneration schemes.
All companies must adapt as the market and competitors change. Amec, which was considered to be a contractor, is now keen to point out that more than half of its earnings are generated from the higher-margin support services sector. And Jarvis has been forced to embark on a radical restructuring of what was once a great business (see page 20).
One company that is moving to an international platform is multidisciplinary firm White Young Green. It made seven acquisitions in the six months to 30 June 2004 to plug gaps in its services.
The most significant was its purchase of IMC Consulting.
By buying a business that specialises in social and economic advisory services in developing economies, WYG is now well placed to identify infrastructure opportunities at an early stage – and, more importantly, to exploit them.
Last month IMC won an £8.8m contract to manage an economic development programme in
Kwazulu-Natal in South Africa, for the European commission. Other clients will include the World Bank and the Department for International Development. It is low-cost, low-risk business and reflects the fim’s long-term strategic approach.
Since it bought IMC in May, WYG’s share price has risen almost 50%, reaching 267.5p at close of trading last week.
Shares in the construction sector overall had an unremarkable week, closing about 1% down at 2844.
The housebuilders fared better than they have done in recent weeks, with a modest rise in share price for most.
Highlights included Countryside Properties, the housebuilder at the centre of a proposed management buyout led by chairman Alan Cherry, and speculation of a rival bid by investor Rock Pacific. Countryside shares rose 8% to 274p.
Westbury also had a good week, up 3.4% to 379p, after it announced a 21% hike in pre-tax profit over the half-year period.
Angela Monaghan is business editor