The acquisition of two Verry Construction contracts will add £40m to McLaren Construction’s top line next year
Speaking after the Essex-based contractor announced its results for the year to 31 July 2008, finance director John Bailey said the two schemes would account for 25% of its estimated £150m turnover in 2010.
He said: “The Verry deal has enabled us to get into new markets and pick up great jobs like the City of Westminster college [pictured] and Hackney Building Schools for the Future deal.”
Turnover in 2008 was flat, falling slightly from £133.8m to £131.9m, a figure that Bailey said would be similar in 2009.
Pre-tax profit fell 69% from £5.5m to £1.7m, largely as a result of a higher contribution to the company’s employee benefit trust. The company ended the year with net cash of £17.9m, a figure that will fall to about £14m at the end of July 2009.
Bailey also outlined the company’s plans to break into Dubai and said it had not been put off by reports that the financial bubble had burst in the UAE.
Moving into the following year, we will complete acquisitions of suitable companies
He said: “There have been problems on the residential side in Dubai but there is still a market for industrial and commercial work.”
A company statement indicated that more acquisitions may follow the Verry deal. It said: “McLaren managed its exposure to the current economic climate by continuing to ensure zero borrowings with large cash reserves. Moving into the following year, we will complete acquisitions of suitable companies in order to establish ourselves further in certain market sectors.”
According to the accounts, McLaren owner Kevin Taylor received £14.1m although Bailey said most of that figure was a payment to the company’s employee benefit trust. It is understood Taylor took home a six-figure sum.
Taylor, who has a 94% stake in McLaren, founded the company in 2001.