Driver Group hit by SSI trouble and currency blows
LANCASHIRE-based construction consultancy Driver Group has suffered the knock on effect from the problems at the Redcar plant of Sahaviriya Steel Industries (SSI) and currency effects in the Middle East, costing a total of £450,000.
The Haslingden company had a small team engaged at SSI in early September, but the work of all its consultants had now been terminated.
In its pre-close trading update ahead of its results for the year ended September 30, Driver Group said there would be no adverse impact on its operations, but its UK business had receivables due from SSI of about £200,000.
The company, which reported a loss of £2.1m in half year results as a result of its operations in Africa, Middle East and Asia, said the second half of the year had seen revenues at record levels across the Group, achieved through organic growth of 20% and the addition of a full six months of revenue from subsidiary Initiate Consulting, which was acquired in December 2014.
A Driver Group statement said: “Revenue in Africa/Middle East/Asia (AMEA region) is up 30% compared to that in the second half of the prior year.
“The investment in the AMEA region in the first half of the year did not start to deliver the expected results until June, but record revenues were achieved in that month and were subsequently bettered in each of the succeeding months of July, August and September resulting in a strong Q4.
“This growth has been driven from the United Arab Emirates, South Africa and our recently established regional Oil & Gas offering based out of Singapore.”
But in the second half of the year its AMEA business was unusually impacted by adverse movements of approximately £0.25m due to the strong pound against the Middle East and South Africa currencies.
Meanwhile, Initiate continues to trade broadly as expected in the UK, although revenues have been marginally impacted in Q4 on the Network Rail account due to the effect of changes in its procurement of services.
Initiate’s project delivery and project management services to the infrastructure sector will continue to be developed with existing clients such as Transport for London, Network Rail and Heathrow Airport.
There are also new opportunities through HS2 and Highways England and it has recently been appointed on the Department for Transport Framework for Programme and Project Management for rail related work.
