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Quarter of civil engineering firms face fight for survival next year

IS YOUR company a winner, a chancer, a sleeper or a loser? If it is a winner or a chancer, you are pushing the losers out of the market.

Losers - more than a quarter of UK civil engineering firms - will not see out 2001 in their present shape, according to a new analysis of the civil engineering industry by Plimsoll Publishing.

The report, First Edition 2001 Plimsoll Portfolio Analysis: Civil Engineering, says these firms will disappear, be taken over or be forced to change to stay in the market.

Winners and chancers are capturing market and profits with a combined sales growth average of more than 27.3%.As they try to maintain sales and profit targets, acquisitions could intensify in 2001.

Analysis of the last four years of trading of 1185 companies describes four types. Winners have low borrowings (debt) as a percentage of sales and high sales growth; chancers have high borrowings and high sales growth. Sleepers have low borrowings and sales growth; losers have high borrowings and are growing below average.

For the 297 losers, time is running out. Their level of debt is high, at 17.4% of sales on average. A more sensible figure would have been about 6.5%, the report says.

These firms have lost market share and sales growth is declining by an average 7.8%. Their margins are slim at 2.3% on average and almost 25% of them are loss making.

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