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Skanska UK targets complex projects


SKANSKA UK is to target complex projects in pursuit of increased profitability the company's chief executive David Fison said this week.

Fison made the claim as he announced increased prots but lower margins for the first quarter of 2007.

He said winning complex jobs, big or small, would help continue this growth.

'We aren't interested in growing our sales if we don't grow prot, ' said Fison.

'Complex commercial buildings and utilities contracts are good examples [of jobs Skanska wants to take on]. When you get alongside regulated industries like utilities, there is real scope for adding value by improving processes.

An example has been the firm's contract to manage the replacement of National Grid gas pipelines in North London.

This has resulted in increased productivity and safety among subcontractors.

Skanska UK's turnover for the fist quarter of 2007 was £283.6M, up from £195.4M in the first quarter of 2006. Profits were also up from £5.5M to £7.4M, although margins across both periods fell from 2.8% to 2.6%.

Orders have jumped a massive 91% to £2.3bn, half of which Fison expects to be completed in the next 12 months.

Fison attributed at least half of the turnover growth to the acquisition of streetworks contractor McNicholas last year.

This doubled Skanska's utilities turnover. The rest has come from large private nance initiative contracts such as Barts & The London New Hospital Redevelopment, work on the government's Building Schools for the Future programme, and civils projects such as the extension of the Docklands Light Railway to Stratford.

Skanska will focus on organic growth for 2007, said Fison, but did not rule out niche acquisitions.

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