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Civils work drives Costain profits

Contractor Costain yesterday posted rises in profit and turnover thanks to strong workloads in its key civil engineering sectors.

Costain’s pre-tax profit was up 17% to £23M for the year ended 31 December 2008 on a turnover of £966M, up 13% from 2007.

The contractor also managed to buck the trend of job cuts and increase its staff numbers by 200 during 2008.

Costain’s Civil Engineering division accounts for 85% of the contractor’s order book and focuses its activities on the transport, waste, nuclear, water and marine sectors. Its year-end order book was up 34% from 2007 at £1.67bn. Major contract wins include the Highways Agency Area 7 five-year maintenance contract, the redevelopment of Felixstowe port and the Severn Trent AMP 5 framework.

“We have benefited from the continued implementation of our ‘Being Number One’ strategy that deliberately
focuses the business on major blue-chip customers,” sais Costain chief executive Andrew Wyllie.

“As anticipated, these large sophisticated organisations, which include a range of public, private and regulated enterprises, are seeking to work with fewer contractors on a longer term or partnership basis. We have targeted market sectors where we believe work will be undertaken because of its strategic significance to the nation.Consequently, we have been working successfully towards developing leading positions in markets such as highways, water, waste, energy, health and education.”

The only downside was a £2.3M loss on a revenue of £1.1M for its Spanish property development activies.

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