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Major firm: Costain

Without question the stand-out achievement of 2007 was the opening High Speed 1 and the glorious St Pancras International. NCE’s Major firm played an instrumental role in delivering this “jewel in the crown”.

The refurbishment and extension of St Pancras was undertaken by a Costain joint venture for client London & Continental Railways, as part of the £5.8bn High Speed 1 project that took ten years to complete. At the official opening by HM the Queen in March, specific mention was made of the highly technical and intricate nature of the work undertaken.

But Costain is far, far from being a one-trick pony. Indeed, it believes its biggest challenge in last year was not St Pancras but another infrastructure scheme a few miles north on the M25.

“Successfully achieving time-critical and ambitious developments around the M25 for the Highways Agency were our biggest challenges,” says Costain Group strategy & business development director Stephen Wells.

“These included completing the Holmesdale Tunnel refurbishment three months ahead of schedule without a single reportable accident for road workers in 1.7M hours of work,” says Wells.

This project was voted ‘Number One’ in the UK in a survey of the best-managed traffic road works in Europe by the AA and went a long way to the company achieving the Royal Society for the Prevention of Accidents Sir George Earle Trophy – the UK’s premier performance award for occupational health & safety.

“These awards epitomise our approach to health & safety,” says Wells. “Our partners and family members are entitled to expect all of us to return home safely from work each and every day and we expect all people who work with us to hold the same values with regard to health and safety.”

Outstanding highways work does not end with the Holmesdale tunnel. “Also we widened the A2 and improved Junction 2 of the M25, five months ahead of schedule,” says Wells.

“The biggest of four bridge structures on this £184M scheme required the largest crane in the UK and closure of the M25 for six hours. A 250t, 60m long steel structure was lifted into place by the Sarens Gottwald AK680T, a 1,200t crane.”

But it is not all about highways and transport. Indeed, retaining its market leading position in water is seen as the firm’s biggest concern going forward, along with the not insignificant task of fulfilling its record order book of approximately £1.2bn.

This, it will do, says Wells, by “continued adherence to our principal values with our key resources focused on our top 35 customers in our chosen market sectors”.

The strategy is designed to deliver increased profitability and to date the figures speak for themselves: civils turnover last year was up a steady 10% to £539M but profit soared from £10M to £20M, equating to a doubling of margin to 4%.

Successful delivery is the key and this year Costain was named a ‘Business Superbrand’ for the third time, having first receiving the accolade in 2005.

Fellow winners this year include Apple, BP, BBC, British Airways, BT, Google, Investors in People, Lloyds and Microsoft.

KEY FACTS

Civils turnover: £539M
Civils profit: £20M
Civils work in hand: £243M
Overall turnover: £878m
Overall profit: £19.8M
Engineers employed: 325
Head office: Maidenhead
Flagship project: St Pancras International Station

Highly Commended

Galliford Try

The integration of Morrison Construction into Galliford Try’s Infrastructure division has sent the firm through the £1bn turnover mark and into third place in NCE’s Contractors File’s Top 20. The fact that it has done this whilst increasing profits – and margins – would alone have been enough to earn it a mention in this year’s awards.

But the fact that it has done this whilst improving health & safety, makes it all the more impressive. “In the 12 months to June 2008 our accident frequency rate reduced from 0.36 in the previous period to 0.21, which put us top of the Galliford Try Group,” explains Galliford Try Infrastructure managing director Ken Gillespie.

In fact Gillespie is pretty pleased with all aspects of his division’s performance. “We have grown our business by 25% and our order book now stands at £0.9bn. Record workloads were carried out for our water utility clients in what will be the peak year of the five-year AMP4 framework cycle. Significant contract wins in our transport business have strengthened our financial position. Just as importantly, our customer satisfaction score increased to 74 against a best competitor rating of 71.8.

Nevertheless, Gillespie has concerns: “The recruitment and development of quality people is getting harder and harder as fewer people enter the industry. These factors are a major barrier to maintaining high levels of customer satisfaction, employee satisfaction and profitability and, ultimately, to the company continuing its progress. Put simply, we can get the work but need the people. Four senior directors are currently in the middle of a six-month project to address the situation.”

Future growth will be delivered by solving this dilemma and by concentrating on its key sectors of water, roads and rail, flood alleviation, remediation, renewables and piling.

Work will continue to be delivered through its network of regional civil engineering businesses which has now been expanded to included bases in South Wales and London.

The London base has been busy of late winning plaudits for its on time and on budget clearance, remediation and site preparation of the Olympic Park. “This has shown our skill at resourcing and managing a substantial, high profile and multi-disciplinary project to meet demanding environmental and client-set standards and in a region where we had previously had relatively little experience,” says Gillespie.

KEY FACTS
Civils turnover: £1.1bn
Civils profit: £29M
Civils work in hand: £2.1bn
Overall turnover: £1.1bn
Overall profit: £60M
Engineers employed: 1,175
Head office: Uxbridge
Flagship project: Site clearance, remediation and preparation of Olympic Park

Shortlist

Picking the major firm of the year in the NCE Contractors of the Year Awards 2008 was a tough task. All five shortlisted firms offered persuasive reasons to win. All five saw double-digit growth in civils turnover and mega increases in civils profit.

Clancy Docwra was worthy of mention for doubling its margin in the tough utilities sector, J Murphy & Sons boasted a stellar margin of 8% and Morgan Est doubled profits and saw civils turnover exceed £500M for its first time. Galliford Try stood out for the way it has successfully integrated Morrision Construction into its operation to break through the £1bn barrier whilst increasing margins, and for that receives a High Commendation. But in the final assessment there was only one winner: Costain.

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