The construction group鈥檚 accounts for the year to 31 December 2011 show a 20% fall in pre-tax profits to 拢21.1m, down from 拢26.6m in 2010.
Group chief executive Rick Willmott said: 鈥淲hile it鈥檚 a substantial milestone in our 160 year history to become a 拢1 billion turnover company, our reduced profit for 2011 also reflects the tough market we are in where margins are now being squeezed. The lack of funding in the public sector together with a lack of confidence in the private sector is placing pressure on workload volumes. That said, our strategy to focus Willmott Dixon on new areas of growth, especially in the green economy, to re-balance our work equally between public and private sectors and develop a pipeline of opportunities in our development division Regen, which will also benefit our Capital Works division, is gaining real traction.鈥�
Willmott Dixon鈥檚 recently launched Energy Services division has won its first major contract - a 拢17m contract to upgrade 2,000 homes in Wales.
Mr Willmott said: 鈥淚鈥檓 delighted we鈥檝e secured a 拢17m contract to manage the retrofitting of 2,000 homes in Wales for the Welsh Assembly that will take hundreds of families out of fuel poverty. This follows our selection by DECC to be a Pioneer Green Deal Provider, which goes live in the autumn, and reflects our investment in the development of processes and skills to play a significant role in improving the energy efficiency of property through mechanisms like the Green Deal.鈥�
Talking about the three operating divisions, Mr Willmott said:
Capital Works
鈥淲hile our contracting, housing and interiors鈥� companies are maintaining market share, it remains a tough environment with reduced availability of work and increasing margin pressure.
鈥淲e are active on a number of major frameworks including Scape where our standardised concept Sunesis, developed in partnership with Scape to cut the cost of new schools, has already created over 拢100m of inquires, with many projects now at planning stage and a number under construction.聽 We intend to launch a leisure sector version of Sunesis this summer as innovation is key to delivering 鈥榤ore for less鈥� to our customers in this competitive market.
鈥淪ustainability know-how is also an important differentiator. Two examples are our role building one of the UK鈥檚 largest Passivhaus residential developments in Camden and first zero carbon 鈥榠n use鈥� school, Ashmount Primary School in Islington. Our knowledge of building sustainable, energy efficient property is something that more and more customers want to talk to us about as it creates real value, such as our role in creating the first BREEAM outstanding health facility, in Sunderland, to reduce operating costs.
鈥淥ur work is balanced 70/30 between public and private sectors and what clients appreciate is our ability to blend skill-sets on large projects, something best illustrated by our project to build Woolwich Central, where we are using our contracting, house building and interior fit-out skills to deliver a 拢86 million project for Spenhill that includes a 80,000 square foot Tesco superstore and 259 apartments. Similarly, the scale and scope of our interiors work is increasing, exemplified by our 拢10 million contract to fit-out a new eight-storey building for the London School of Economics.鈥�
Regen
鈥淲e鈥檝e been diligently creating a 拢500 million pipeline of opportunities through our Regen development company, providing high quality project opportunities for our Capital Works division.
鈥淲e are currently regenerating Dee Park estate in Reading over eight years to provide over 700 homes as well as developing over 100 homes at Brenley Park in Mitcham, with both showing strong sales through a combination of good location and sensible pricing. Our ambition and skill-set to undertake mixed-use development is further underlined by our position as preferred bidder with Morrisons to develop a 1.5 hectare site in Walthamstow town centre into retail and residential use. We also secured the 拢60 million residential element of a regeneration in Greenwich as part of a development agreement with Cathedral Group Plc and Development Securities Plc which will be on site during 2012.
鈥淲e want to work in partnership with local authorities to help them realise the asset value and economic potential of their land. We have put a concerted effort into developing a model for the private rented sector that can help local authorities and private land owners get the best use of land to generate much needed income.
鈥淥ur goal is to establish a portfolio of homes for market rent in joint venture with land owners and we are in detailed talks with Birmingham City Council, which this year gained cabinet approval to join the LLP we have created with WM Housing Group to build 400 homes near the centre.鈥�
Support Services
鈥淥ur repairs and maintenance company Partnerships had one of its most successful years, securing long-terms contracts with Home Group, Affinity Sutton, ACIS and Guinness South. We are now responsible for the maintenance of over 150,000 homes across the country and believe that our investment in skills development, systems, processes and technology, matched with our focus on working closely in local communities to create jobs through initiatives like apprenticeships, is creating real value for our clients.
鈥淲e have also launched our Energy Services company to focus on the tremendous opportunity to reduce energy costs in property through initiatives like the Green Deal. The first major contract, awarded this month, will see Energy Services manage the retrofit of 2,000 homes in mid and north of Wales in a three year programme. Our role on this ERDF funded Arbed programme includes managing the surveying, designing, costing and delivery of work to individual homes as part of Wales鈥� strategic energy performance investment programme to reduce the carbon footprint of its housing stock and future-proof homes against rising energy prices.聽 Our work last year on one of the UK鈥檚 first Green Deal pilot projects to retrofit private homes in South Cambridgeshire also gave us an enormous amount of learning we are taking to this new project.鈥�
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