WYG announces £18m contract win alongside results ahead of expectations
PROJECT management consultancy WYG today announced a new £18.2m contract win in Africa as it delivered end of year results ahead of expectations.
The group said the contract is to develop a Climate Resilient Infrastructure Development Facility (CRIDF) in Southern Africa.
The Leeds-based business said its results, which show a return to adjusted pre-tax profit for the year ended 31 March 2013, mark a “significant new milestone” in the progress of the group.
It also said the contract underpins the work WYG does with the MoD to manage its army bases around the world, including Afghanistan.
Chief executive officer of WYG, Paul Hamer, said: “We had a strong finish to the reporting year across our four regions and based on our most recent reviews of the business, we now anticipate that the profit outturn for the current financial year will be approximately 10% higher than current market expectations for the year as a whole.
“In the UK, we have been successfully winning work in our key sectors, including urban and commercial development, defence and justice and energy and waste, despite continued subdued UK market conditions.
“Outside the UK, our expertise in donor funded projects and our relationships with key clients continue to position us well for international growth opportunities, as demonstrated by recent contract wins such as IPF3 and CRIDF.
“The group’s better than expected return to adjusted profit before tax for the year ended 31 March 2013 marks a significant new milestone in the progress of the group.”
Revenue for the year was £125.7m (2012: £139.9m) and the adjusted operating profit was £1.8m (2012: loss of £3.5m).
WYG said: “We have seen a significant improvement in business performance in the second half of the year, with an operating profit before separately disclosed items of £1.5m, which compares to £0.3m in the first half.
“We have maintained our focus on improving staff utilisation and continued to make better than expected reductions in overhead costs, particularly professional indemnity insurance, property and information technology costs. We will seek to achieve further benefits in productivity and overhead savings.
“As a result of this focus on the performance of the business, profit before tax before separately disclosed items was £0.7m (31 March 2012: loss of £5.8m), reflecting a £1.1m adjusted profit before tax in the second half of the financial year compared with an adjusted loss before tax of £0.4m in the first half.”
The West Yorkshire business today said its new contract will build on its “strong track record” for a project in the Western Balkans,
Mr Hamer said: “This contract win is testament to the range and quality of our technical expertise. It builds on our strong track record in delivering the £68m Infrastructure Preparation Facility (IPF) in the Western Balkans, which has financed nearly 130 projects, leveraging £4.5bn in infrastructure investment and our significant water infrastructure experience.
“It also clearly demonstrates the group’s progress with our strategy of generating good quality international revenues and diversifying our client base through collaborative partnerships.”
CRIDF aims to develop small-scale infrastructure to improve access to water for many of the 95 million people living in a number of countries in the Southern Africa Development Community region.
The programme will seek to improve reliable access to water, the lack of which is already constraining human development and economic growth in the region and help mitigate expectations of increases in water demand, reduced supply and greater flood risk.
The £18.2m contract over two years also has the possibility of a further extension.
