Despite taking £12.1m in writedowns of companies bought, firm is considering bolt-ons
WYG is looking at six different companies with a view to making further acquisitions.
This is despite its sale last week of specialist engineer Adams Kara Taylor and the fact that it has taken £12.1m in writedowns of companies it had bought before the recession.
We have learned a painful lesson and would focus on integrating
David Wilton, WYG
Announcing its results last Thursday for the six months to the end of 2010, the firm made a loss of £22m after exceptional items. The majority of this was because of the writedowns. Revenue fell 27%.
Nevertheless, WYG is considering bolt-ons of non-UK companies and has expressed an explicit interest in China. David Wilton, finance director, (pictured) said: “Having spent two years cutting we would like to grow. We have learned a very painful lesson and we would focus on integrating the businesses.”
On the pre-recession acquisitons, he said: “The previous guys bought 38 business with no assets. We had £80m on the books from these businesses. The problem for us is that they are smaller than they were [before the recession].”
The engineer came close to insolvency in 2009 after a strategy of rapid expansion fuelled by acquisitions unwound as a result of the recession. It was saved by a debt for equity swap with banks.
We have seen strong local public sector work in many countries
David Wilton, WYG
Wilton said WYG is attempting to offset a stagnant UK market by expanding overseas and has grown its global order book to £89.2m from £76.6m in 2009.
In the half year it expanded into Syria, Croatia, Bosnia and South Africa, and Wilton said it was looking at gaining a foothold in China.
“The good thing about international is that we have seen about 20% growth per annum,” he said. “We have seen strong local public sector work in many countries.”
The group shrank by 400 employees to 1,748 staff, and another 100 have left since.
Hanif Kara on the AKT buy-out
Hanif Kara, director of Adams Kara Taylor, says the move by the top five directors of AKT to buy out of White Young Green was driven
by a desire to prioritise quality over quantity.
The engineer, which employs 117 staff and will now be known as AKT II, has a reputation for its work on high-profile and iconic buildings such as the Thomas Heatherwick-designed Expo pavilion in Shanghai, China.
Kara said of WYG: “They’re driven by quantity, we’re driven by quality. We’re now free and independent and we want to take AKT to the
“Clients working with us felt exposed to the risk of WYG. It has been very difficult to survive within that. We can now offer more security for clients.”
The £3.75m deal was part-financed by Swedish engineer Tyrens, but Kara said the five AKT directors will retain board control, with Tyrens taking two places.