MOWLEM IS to continue diversifying its activities to counter low construction margins and falling infrastructure spending.
The news came as the contractor announced steady but unspectacular half year results. 'We will continue to develop those businesses that can bring better margins than construction,' said chief executive John Gains.
In the past year the company has acquired water contractor Johnston, imported personnel from its Australian division Barclay Mowlem to develop its rail arm and launched the insurance maintenance business Skillbase. It has also pushed its environmental business.
'We are searching for suitable acquisitions particularly in the environmental business,' said Gains. 'It is the area with the highest margins. We have a flexible business at Mowlem that can cope with changes. Buying niche skills enlarges the total capacity of the business.'
Mowlem's construction activities saw an operating profit of pounds 3.3M on a turnover of pounds 496M, a margin of 0.7%. This is up on last year's interim profit of pounds 1.7M from a turnover of pounds 465M. The group's half year pre-tax profits were pounds 13.8M on a turnover of pounds 719M, compared to a pounds 9.5M profit on a pounds 696M turnover for the same period last year.
Mowlem's new director of corporate development is Tom Dobrashian. Peter Pentecost has taken on the role of director of market development. Ken Minton is to resign from the Mowlem main board at the end of the year but remains chairman of SGB.