BAM Construct UK, one of the UK subsidiaries of Dutch construction giant Royal BAM Group, saw its profits fall by 40% last year despite a 5.6% growth in turnover.
BAM Construct UK reported turnover of £886m for 2014 (2013: £839m), with pre-tax profits falling to £6.6m (2013: £10.9m) at a margin of 0.8%.
However, chief executive Graham Cash said that, with the recession now over, the business was in good shape, with a £1.79bn forward order book.
Graham Cash said: “BAM Construct UK steered a prudent course throughout the recession, aimed at keeping the shape of our business stable, and being able to offer reliability, quality and certainty to our clients. A 0.8% profit margin reflected the final phase of recession. In the new conditions, we aim to improve this by using BIM, lean technology and efficiency. Most construction divisions have nearly full order books for 2015.”
BAM Construct UK includes BAM Construction but not the civil engineering contractor BAM Nuttall. As well as construction, BAM Construct UK engages in property development, design, services engineering, and facilities management services.
Mr Cash said: “The commercial property market revived in 2014. BAM Properties achieved considerable success letting and selling the portfolio of offices that it has developed in recent years.
“Our facilities management business now has a total FM capability of hard, soft and mobile services and it has broadened its range of customers. As well as being an efficient business and profit earner in its’ own right, the expertise of the facilities management team adds value to our design, property development and construction teams.
“The industry is at last emerging from recession. 2014 was an eventful year for construction with many major contractors changing the shape of their businesses by retreating from parts of the market, closing offices, or divesting particular business streams and changing their senior personnel.
“There is a saying: ‘Culture eats strategy for breakfast’. Our cohesive and collaborative culture meant our staff stood by us and we stood by them in the recession. They continue to choose to stay with us.
“Now we are placed to grow sustainably by growing our FM business and, in particular, by combining all our skills and services to offer whole lifecycle options to customers.”
Mr Cash added: “Our culture is particularly suited to frameworks and an important goal for us in 2015 will be to win a place on the Procure 22 Framework.”