ENER-G plants seeds for overseas growth
FAST growing renewable energy group ENER-G has increased annual turnover by close to 30% for 2010 and is set to beat that again this financial year, despite a planned period of integration.
The company, which employs 760 staff worldwide and 270 at its Salford headquarters, saw group turnover increase 28% to £124.8m for the year to March 2010, from £97m in 2009.
Derek Duffill, group managing director, told TheBusinessDesk: “Some parts of the business struggled – those associated with UK construction. But 47% of our turnover comes from overseas and our overseas markets are growing very quickly.”
Performance in the first quarter of 2010/11 was ahead of last year, according to Mr Duffill, and despite the planned year of integration after rapid expansion and acquisitions in Italy and Romania, he expects full year turnover to increase again.
He added: “This year we are focusing on optimising the businesses we have taken on and on introducing common systems across the group.
“There will be some investment there – introducing senior people and building the foundations for the next year of growth. If you don’t have the controls in place you can grow too quickly.”
The company is also in the process of building an extra 2,500 sq ft of office space at its Salford base, at a cost of £2m.
The expansion will see the 60 staff based at its Pendleton site move to the company headquarters, and consolidate all office and manufacturing functions on one site, with total manufacturing space increasing by 25%.
According to Duffill, these moves will help the company ready itself for another few years of rapid growth, which will largely come from expansion into new overseas markets.
ENER-G is soon to start on a “massive” contract in South Africa, and is investing £20m in building seven generation plants that will convert landfill gas to electricity.
Mr Duffill said: “We built one to prove the concept and are just waiting for the power purchase agreement to come through. Once we have that – hopefully around August – then we’ll start an 18 month build programme.”
The company is also looking at two or three ventures in Mexico, through its joint venture subsidiary ENER-G Mexico, which was set up last year.
“We are looking at land fill electricity generation opportunities in and around Mexico, it’s part of our long term plan to enter new territories,” said Mr Duffill, who added that he also has plans to look at one or two other large markets in the next few years.
“We are trying to plant the seeds this year, while we put systems in place for the next 12-18 months. Those seeds will take some years to see growth but we are seeding markets, ready to see growth in year two.”
