Fulcrum turns the corner as restructure creates maiden profit
A MAJOR restructure of Fulcrum, the Sheffield-based provider of utilties infrastructure, has resulted in the company’s first operating profit.
The company was acquired from the National Grid in 2010, when it was described by then-chief executive John Spellman as “a business with great potential but burdened by an inefficient cost base and operating model”.
Creating the right infrastructure internally has proven harder than expected but achieving a pre-tax profit of £600,000 in the yeat to March – a £5m improvement on 2014’s results – has created a platform for future growth.
The main focus has been on reducing overheads, which have fallen from £17m to £11m in an 18-month period, and has resulted in doubling its workforce to 200 after bringing services in-house.
Revenue actually fell 12% during the year, to £33.7m, but its gross margin increased by four percentage points to achieve its profitable performance. Fulcrum’s board has recommending paying a maiden dividend, of 0.4p per share.
Fulcrum’s chief executive Martin Donnachie described the results as “a significant achievement”.
“With our established customer base, trusted delivery and anticipated upturn in construction activity, we have a robust platform from which to leverage sales growth,” he added.
“Our targeted growth strategy is focused on winning major projects, enhancing key account relationships through improved levels of service and increasing penetration in the housing market.”
The company said it has a solid order book and has identified a sales pipeline to build upon its customer base of 1,200 UK clients.
During 2015 Fulcrum secured a number of significant contracts, including a £700,000 installation of gas, water, electricity connections to new mixed-used development in Wales. and a £500,000 design and installation project as part of The Improving Homes Schemes for Lambeth Living.
In Yorkshire its highlights included a £200,000 dual fuel infrastructure project for Hall Construction to deliver new gas and electricity connections to 13 industrial and commercial units in South Yorkshire
