Construction and civil engineering firm Esh Group has returned to profitability after a difficult period in recent years.
The County Durham company has undergone a major re-organisation over the past four years and fell to a loss during the pandemic, having previously noted ‘challenging’ conditions in the years before that. But now it says that turnover has increased by £32m to £255m - one of the largest increased in the company’s history - and that it has posted an operating profit of £4m.
Chief executive Andy Radcliffe noted that the business, and the wider construction sector, was seeing unprecedented cost pressures and was targetting projects that would “increase turnover via routes to market which present reduced risk”.
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He said: “We are delighted to report a remarkable improvement in profitability, particularly during another year which was marred by the impact of the global pandemic.
“This achievement is no mean feat and is underpinned by the cumulative efforts over the last four years to reposition the group to target resilient sectors of the construction industry which demonstrate long-term stable fundamentals.
“Despite continued pressures emanating from supply chain constraints and elevated levels of cost inflation, our efforts to deliberately design a business model that allows the smoothing of positive and negative factors across our operations has paid dividends, allowing us to insulate a large part of the business from levels of inflation not seen in our generation.”
Esh said it had ended 2021 with £21m and remains debt free, without drawing on its £7m credit facility at any point in the year. Gross profit margins were at their highest levels in the last six years, and it said it had a forward order book of more than £500m and was working on high profile schemes on the Tyne Bridge and the Stockton Waterfront.
The company’s development division, meanwhile, has submitted planning applications for affordable housing, extra care and general needs housing in Sunderland, Gateshead and Northumberland. Mr Radcliffe added: “I am incredibly proud of the team at Esh. Their resilience, commitment and ingenuity in dealing with the many challenges we have faced as we worked to fundamentally reposition the group is nothing short of amazing. Our gratitude, as always, goes out to our clients, our supply chain and wider stakeholders – we are who we are due to the determination of a large group of people who believe that we only succeed, if we all succeed.”
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