Sales and profits up at Eric Wright

CONSTRUCTION and property development group Eric Wright achieved an 80% in pre-tax profits before exceptionals of £6m in 2009 (2008: £3.3m) on the back of a 17% uplift in sales to £128m (£109m).

The company said that once exceptionals relating to the writedown of the carrying value of its property investments are factored in, its profits were £4.4m, compared with a loss of £1.3m a year earlier. Moreover, chairman Eric Wright said that the group doesn’t expect any further writedown either in the value of its portfolio or through loss of income from rented stock.

“The underlying trading performance of the Group has remained strong notwithstanding continuing difficult economic conditions, especially in construction and commercial property,” he said in a trading statement accompanying the accounts.

He added that its resilience had been “borne by a number of successful partnering arrangements and a rigorous approach to managing its risks.”

The increase in turnover is largely due to its completion of a PFI project in Blackpool for the local Primary Care Trust, which led to a one-off gain of £20.9m as a result of a sale-and-leaseback deal with the Trust. Turnover at its construction division dropped by £26m to £70m, which the firm said was “in line with many other construction-based organisations”. It also argued that all of the contracts which it was involved all “generated positive contributions” to its profits, which increased by £600,000 to £2.8m during the year.

Since its year end, the firm has won a Building Schools for the Future project in Blackpool where it is building two new secondary schools worth a combined £50m and it has bought Radcliffe-based electrical engineering contractor Site Electrical.

Managing director Jeremy Hartley said: “2009 saw all the divisions perform above expectations despite the challenging trading conditions seen across the sector.

“Its ongoing partnerships with both public bodies and private companies provided an underlying level of activity which generated valuable stability. During 2010, and looking forward to 2011, the order book remains strong for both construction and civil engineering and the new management team in property development is progressing some excellent opportunities in both the retail and residential sectors.
“We believe the Group is well placed going forward to adapt and react to the market changes”.