One of the largest construction and engineering contractors in the country, the Stourport-based Thomas Vale Group, has announced record results after making strategic cuts, despite a horrific year in the sector that force it to write off millions of pounds in cancelled contracts.
In the last full year, the group made a pre-tax profit of £3.6 million, up 13 per cent on the year before.
But sales as a whole were down eight per cent at £197 million, which the firm put down to a shrinking market.
Over the last year the company has had to deal with further shrinkage in the construction market and the discontinuing of major contracts.
The group made a significant operating loss of £2.3 million on discontinued operations.
It was also involved in last year’s contract-rigging scandal, when it was one of 103 companies ordered to pay penalties adding up to £129.5 million by the Office of Fair Trading.
But despite the difficult trading conditions, directors hailed the improved profits and cash position at the group.
It signed a number of high-profile contracts for local authorities across the Midlands, as well as the likes of Wolverhampton Homes, and a contract to aid the delivery of 10 new fire stations through the Staffordshire Fire and Rescue PFI.
The company also ruthlessly cut unprofitable wings of the business.
It closed its Thomas Vale Construction office in Reading; axed the PJM Adams business that installed and maintained street lights, and sold on a 60 per cent interest in electricals firm Electec to directors.
But one dark cloud on the horizon will be the cancelling of the Building Schools for the Future project by the Government.
The group had contracts with BSF in both Birmingham and Stoke-on-Trent.
But Thomas Vale chairman Mike Wallis praised the “underlying strength” at a difficult time, particularly in a year that has seen many construction firms come close to collapse as contracts disappeared.
He added: “Strategic actions put in place in 2010 have ensured that the group is in excellent shape with secured turnover resulting from our framework and partnership contracts and with no exposure to speculative development.
“In addition, the business has achieved good levels of profitability and strengthened balance sheet at the year end,’’ Mr Wallis said.
‘‘Our order book is a record level of £500 million and we expect to continue that growth in the future.
‘‘Such strong year end results provide a solid foundation for organic growth in our core business areas in social housing, decent homes, education, healthcare and infrastructure.”
Mr Wallis said the firm had a good cash position and had no exposure to debt. The group generated £5.7 million in cash during the year ending March 31, taking its bank balance to £17.9 million.
Thomas Vale employs some 800 peopled across the Midlands, as well as supporting a network of about 2,500 supply chain partners.
It operates from regional centres across the UK including Worcestershire, Birmingham, Warwickshire, Wolverhampton, Stoke-on-Trent, Staffordshire and Herefordshire.
It has been praised for its work supporting local employment, with the majority of employees coming from local areas, and a high number of apprenticeships being offered.