In a pre-close trading statement ISG said that it was managing to maintain UK revenues but margins were taking a hit. International work, by contrast, was achieving both revenue and margin growth leading to a ‘substantially higher contribution’ to group operating profit.
The problem-hit southwest construction division has returned to profitability in the last quarter of the year after a restructuring of the business.
The company said: “In the UK, our Fit Out business has maintained its position in a highly competitive London corporate office market, where we have seen a reduction in the size of projects. In addition the business has successfully grown its presence in the data centre market having secured a £100m+ project to construct and fit out a new facility in the East Midlands.”
It added: “In the UK, our Construction business continues to experience competitive pressure on margins. However, against the market trend, revenues for the year have increased with a strong performance in the south benefiting from the work secured with LOCOG to assist with the preparation of the 2012 Olympics.”
It concluded: “In summary, in the UK in the short term we anticipate that trading conditions will continue to be difficult. We are looking to target areas where we see growth opportunities, particularly in the data centre, hospitality, high-end residential and international retail markets.”