Builder Sisk reports profit jump of 73% to €24.7m for 2017
Turnover dips 5% to €792.2m as once-off settlement for contracts boosts record profits
Total equity at the end of the year for Sisk was €88.2m, around 20% more than at the end of 2016. Sisk had €97.1m net cash on December 31st.
Builder Sisk expects to deliver a strong performance this year and into 2019 after reporting profits of €24.7 million for 2017.
Pre-tax profits at the construction and civil engineering group grew by 73 per cent to €24.7 million in 2017.
Sisk said that this included a once-off €11.4 million payment that resulted from an associate company settling historic building contracts. The company did not comment further on the €11.4 million gain. A large part of it is understood to relate to the settlement of a claim for road-building contracts in Poland.
But chief executive Stephen Bowcott confirmed that its order book was full this year and 60 per cent secured for 2019.
Sisk recently won the Dunkettle interchange road project in Cork from State agency Transport for Ireland. In the same county, it has a €600 million contract with pharmaceutical giant Johnson & Johnson to build a plant to produce three new drugs. It is the multinational’s biggest investment outside the US.
Quintain, owned by US investment fund Lone Star, last year hired Sisk to build 700 homes for rent in Canada Gardens in Wembley in west London, a deal worth £211 million.
The Irish company is also the preferred bidder for a £200 million extension to Great Ormond Street Children’s Hospital in London, though it will be up to two years before it gets on site.
“There’s a lot of shouting in our industry about a lack of resources,” Mr Bowcott said on Tuesday. “But we think that there are sufficient resources. We just need to get productivity levels up, then there is a good chance that we will bridge the resource gap.”
However, he warned that the industry desperately needed to hire more apprentices to fill jobs that will become available over the next 5-10 years. Sisk has its own apprentice school.
Sisk is the main contractor on Capital Dock, a mix of apartments and offices running between the south bank of the Liffey and the Grand Canal Basin in Dublin funded by State body Nama and US investor, Kennedy Wilson.
The builder pre-cast many of the columns and floors in the buildings and brought them on site, speeding up development and allowing it tighter control over costs.
In a statement, Mr Bowcott noted that the group shifted focus to generating value, which meant it switched to be a “profit-led business” rather than revenue led.
“The results of this approach are clear across the business where I’m happy to report that Sisk recorded no loss-making projects in 2017 for the second consecutive year,” he said.
Total equity at the end of the year was €88.2 million, around 20 per cent more than at the end of 2016. Sisk had €97.1 million net cash on December 31st.