Clugston Group has announced its second consecutive set of record financial results after delivering a 26 per cent jump in turnover and five per cent rise in pre-tax profit.
The privately-owned group, which has interests in construction, facilities management, logistics and property development, said turnover rose to £231m in 2013/14, up from £183m the previous year, whilst pre-tax profit rose from £6m to £6.3m.
The Scunthorpe-based group of companies, which was founded in 1937, said its strategy of concentrating on core sectors, whilst seeking opportunities in niche markets, has resulted in growth across all its activities. Group chief executive Stephen Martin said: “I am delighted to be announcing our best ever set of results. We have substantially increased turnover, improved pre-tax profits, generated excellent cash balances and further strengthened our balance sheet. Our success is dependent upon the strong commitment and determination of all Clugston employees.”
The construction division posted a 40 per cent increase in turnover to £136.7m. It is the third consecutive year of growth in excess of 30 per cent for the division.
Mr Martin said its success was achieved through a combination of a selective bidding strategy and effective project management, with robust risk control procedures.
Clugston has also remained focused on core sectors such as Energy from waste in a joint venture with French process specialist CNIM. During the year the partnership secured and started work on major energy from waste facilities in Leeds and the North East, bringing to eight the number of schemes to be jointly delivered.
Clugston Construction also secured contracts in the health, education, and industrial sectors. The division is also opening a new office in the West Midlands today.
The facilities management business, continued to extend its range of services and build on its base in the health and industrial sectors.
Clugston Distribution Services, the group’s logistics division, delivered a 21 per cent increase in turnover from £10.9m in the previous year to £13.2m. Growth focused on several diverse markets such as fuel, bulk food, ash powder and intermodal, as well as strengthening its customer base. The division is continuing to forge ahead with nationwide expansion plans, opening new depots in Haydock and Reading. It also recently announced a £2.2m investment in fleet renewal and expansion.
The logistics business continued to make significant investments in fuel economy technology designed to optimise driver behaviour and reduce carbon emissions.
Clugston’s property division also performed well, seeing significant signs of recovery in a number of sectors.
It entered into a new joint venture with Park Row to acquire a 26,000 sq ft prime office block located on Park Row in Leeds. The property has now been let on a 15 year lease to the University of Law.
It has also bought Synergy 27, an office building off Gelderd Road in Leeds, its first solo investment in many years.
Mr Martin said: “We plan to build up our rental portfolio. There are a lot of opportunities out there, particularly in Leeds.”
He added: “During the past year we have continued to successfully deliver services and projects to our established customers and further build on our expertise in key sectors. We now have solid foundations on which to continue to develop. Whilst we believe 2014 will continue to be challenging, with our main markets still remaining highly competitive, we remain confident for the future.”
The directors will recommend a final dividend of 15p per share at the AGM to be held later this month, thereby increasing the total dividend for the year by 14 per cent to 25p.