Booming support services firm Mouchel Parkman has assembled a £120 million war chest as it looks to underline its strong organic growth with acquisitions.
The company, which employs 600 people in the Midlands, yesterday announced that pretax profit for the year to July 31 rose by 29 per cent to £26.4 million on revenues 21 per cent ahead at £374 million.
The group, created by the 2003 merger of Mouchel with West Midlands-based Parkman, also said it was sitting on a record £1.2 billion forward order book of reliable UK public sector outsourcing work and has been actively looking at takeover targets.
Chief executive Richard Cuthbert said he seeking opportunities in all of the company's three sectors, highways, government services and regulated industry, and was confident a deal would be struck soon.
"We didn't complete a deal in the 12 months to July 06 but I guess we'd be disappointed if we didn't bring at least one in over the first half of this year," Mr Cuthbert said, adding that he would look at bigger deals, not just bolt-ons.
"While we look at small bolt-ons we've got the wherewithal to do much more than that," he said.
"We finished the year with £30 million-odd in the bank - our bank is gagging to lend us money - we've got a facility in place for £100 million.
"We could look at £120 million without even going back to shareholders."
Mr Cuthbert said he was looking at buying a blue collar firm that worked on highways contracts in order to mesh it with Mouchel's white collar skills and produce an integrated service for clients. At the moment, the firm works in joint ventures.
One such JV is with fellow support services firm Accord, which has led to speculation the two could merge.
"A few people have said that Accord is the obvious one to acquire,but it's still quite early days," Mr Cuthbert said. "It's always good to have a courtship before you jump in. It's certainly something we'd think about." ..TEXT: On the company's annual results, Mr Cuthbert said: "We are extremely encouraged by the advances we have made over the last year.
"We have reported outstanding results with strong growth in revenues, profits and earnings.
"Our cash performance has been excellent and we have been hugely successful in winning new work, which reflected in our record order book."
Locally, Mouchel Parkman has recently been responsible for the active traffic management pilot scheme on the M42 motorway, and its ServiRail division recently won a contract for ancilliary civil engineering work connected with a signalling programme in the Solihull area.
The company is also overseeing work on one of the biggest development projects in the West Midlands, the £5 million, 220-acre second phase of the i54 site at Wobaston Road, Wolverhampton.
The dividend has been raised by 23 per cent to 4.05p per share. Shares closed up 8.75p at 373p. ..SUPL: