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Morris & Spottiswood optimistic despite the uncertainty

Significant gains in its housing business during 2008 has resulted in a robust performance for one of the UK’s larger privately owned construction companies, despite the tough economic trading conditions.

 

Morris & Spottiswood has reported revenues of £122.5 million in 2008, down slightly from £125.3 million the previous year, and pre tax profits of £3 million as compared to £3.4 million in 2007.  The company, which employs around 480 people at its offices in Glasgow, Edinburgh and Warrington, continues to operate with nil borrowings.

 

Refurbishment contracts with Glasgow Housing Association, River Clyde Homes, Prospect Housing and City of Edinburgh Council, increased Morris & Spottiswood’s affordable homes portfolio, which is already one of the biggest in Scotland. Increased demand for new build projects (32 units for Link Group in Falkirk) also re-affirmed the company’s building credentials in the housing sector during 2008.

 

Chris Saxton, Morris & Spottiswood’s chief executive says early adoptive measures to reduce exposure to sectors most adversely affected by the recession at the end of last year helped maintain a solid performance in difficult trading conditions.

 

“Retail, commercial, and banking have historically been major strongholds for Morris & Spottiswood and they have been hardest hit by the economic uncertainty which continues to prevail.  However, we do have a strong balance sheet, and as a business, we are quick to take advantage of changing market conditions. Our housing division performed exceptionally well last year and our maintenance and fit out divisions were successful in securing several million pounds worth of new business in healthcare, education, judiciary and planned maintenance contracts, in addition to food retail, commercial and financial services contracts.”

 

Commenting on his expectations for the year ahead, Chris Saxton says: “We do see the market contracting but I think there will be a flight to quality and financial stability, which will be good for our business.  What's important is standing out from the crowd. The key to surviving the current situation is to have a low cost base and to be able to sell to your strengths. A good example is a recently secured £17 million contract with Queens Cross Housing Association to build 140 new homes at Murano Street in Firhill, north west Glasgow.  The development has a total cost of £22.8 million to be met by £14.5 million of grant support from Glasgow City Council and £8.3 million of private finance.”

 

He adds: “In overall terms we have a dedicated and loyal workforce and an increasingly broad sector spread across our three businesses. This leaves us well positioned to meet the challenges and different market opportunities from the recovery when it happens.”

 

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