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Fri August 07 2020

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McLaren sees construction margins squeezed

3 Feb McLaren Construction Group has posted 2019 financial results showing a 22% decline in operating profit.

McLaren Construction’s operating margin for the year to 31st July 2019 was just 0.5%, down from 0.8% the previous year.

Turnover increased 11% to £650.9m (2018: £585.6m) while operating profit fell 22% from £4.6m previously to £3.6m this time.

Pre-tax profit dipped from £3.7m to £3.3m.

However, liquidity remains strong, the directors said, with no long-term borrowing.

McLaren has sought to broaden its client base by getting on public sector framework agreements. It has achieved BIM Level 2 accreditation in 2019 and a three-year digital strategy remains on track. This includes the integration of a common data environment with project design, programme and procurement process.

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Chairman Kevin Taylor said: “McLaren continues to shine as one of the UK’s most successful, privately-owned construction companies and as a partner of choice for both private and public sector businesses.

“Our focus remains on exceptional customer-delivery, which is why we have invested in new business approaches that meet the modern needs of agile and forward-thinking organisations. A defined digital strategy means we are bringing additional design efficiencies, data management and innovative project management processes to our business for the new decade.”

Project highlights from the year include completions in London at Bracken House, a commercial office building for Obayashi Corporation and now home to the Financial Times, and The Ray, a commercial building that is home to LinkedIn UK in Farringdon. McLaren also signed its fourth contract at Wembley Park, taking the overall value of its residential construction projects on the Quintain framework to more than £300m.

Leicester City Football Club training centre is on track for completion in 2020, while work has now started at Castle Quay Waterfront retail/leisure scheme in Banbury.

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