Construction group Henry Boot has raised operating and pre-tax profits by a third in the first half of the year and is beginning to reap the rewards of continuing to invest in land and equipment during the downturn.
The Sheffield firm says it has seen a slow improvement in the sector since the London Olympics.
Highlights have included what Boot says is an unprecedented number of strategic land sites moving through the planning process as the Coalition Government’s new planning policies and regulations have forced local authorities to be more realistic over housing applications.
At the same time, house builders have become more active, boosting demand for Boot’s site assembly and plant hire businesses.
Boot’s involvement is helping to kick-start development of the former Terry’s chocolate factory, close to the racecourse in York, which has stood empty for more than a decade.
In a similar way, Banner Cross Hall-based Boot has been the catalyst for developments in Thorne, on the former Dixon Motors site, and in Chesterfield, where Bryan Donkin’s factory once stood.
Finance director John Sutcliffe says Boot has spent a lot of time during the last five years adjusting its plans for key development sites to meet the demands of a changed market and that is paying dividends.
Although margins remain “incredibly tight” in construction, Mr Sutcliffe says Boot has successfully adapted to the challenge of “making money in the new reality.”
Boot’s pre-tax profits have risen from £5.5 million to £7.4 million for the six months to the end of June on revenue up from £43.3 million to £81.8 million. Boot is increasing its interim dividend from 1.80p to 1.95p.