Willmott Dixon restructures to bring in development finance
Willmott Dixon has reported nearly 50% growth in half-year profits and unveiled a new corporate structure.
For the six months to 30th June 2016, the family-owned construction business made £12.0m profit before tax and amortisation (2015: £8.1m) on turnover of £600m. The secured and probable forward order book stood at £1.15bn on 30th June.
The new structure sees the establishment of three sister companies for contracting, residential development and support services, giving each division greater autonomy pursue its own path.
In particular, it enables a recapitalising of Willmott Residential’s balance sheet to raise finance funds for buying land.
The restructuring follows a review of operations earlier this year that saw the board put the support services business up for sale, but no suitable buyer could be found.
Group chief executive Rick Willmott explained: “This year has seen some important developments to support our growth ambitions. In May, we formed Willmott Residential to combine the capabilities of Prime Place, Be:here and Homes within one company. This has already opened up many new opportunities for sharing skills, identifying new land opportunities and bringing a more holistic approach to house building for our partners and customers.
“More recently, we rebranded our support services businesses as Fortem to grow a strong new brand utilising the technical strengths and capabilities that exist in our people to create a business with greater access to a variety of markets outside its core housing sector.”
In 2017 Willmott Residential and Fortem will move out from under the Willmott Dixon umbrella to become sister companies rather than subsidiary businesses to Willmott Dixon, while remaining owned and controlled by the same shareholder family.
The chart below shows the new structure.
Willmott Dixon Holdings has two subsidiaries: Willmott Dixon Construction and Willmott Dixon Interiors
Willmott Residential has three subsidiaries: Prime Place, Be:here and Willmott Partnership Homes
Wimpole Equity Holdings has one subsidiary: Fortem.
Rick Willmott continued: “This very much recognises each company’s specialisms and it gives senior management greater freedom and flexibility to shape their businesses to pursue specific growth agendas for their markets; but with strong cultural, leadership and ownership continuity. The revised structure also supports our wish to give top management in each of our three core businesses a more direct share in their company and in the success they help create.”
Willmott Residential has a pipeline of 7,500 homes in planning or in development through both Prime Place (private homes for sale) and Be:here (private homes for rent). With the new structure, it aims to bring in money to finance further speculative development.
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This article was published on 28 Nov 2016 (last updated on 28 Nov 2016).