Contractor鈥檚 building arm targets PFI healthcare in five-year plan to increase returns by 90%

Balfour Beatty鈥檚 building division has identified the acute hospital market in Northern Ireland as a means of meeting its goal of increasing profit 90% to about 拢67尘 over the next five years.

Mike Peasland, Balfour Beatty鈥檚 managing director, said: 鈥淲e鈥檙e making a big play in the Northern Ireland market where we see the development of the acute health programme mirroring the rest of the UK.鈥

The northern division of Balfour Beatty construction is at prequalification stage on the 拢250m PFI acute hospital in Enniskillen, County Fermanagh. It also plans to bid for an acute scheme in Belfast, which is expected to be tendered in spring next year.

Peasland said that the building division aimed to achieve a 拢2.2产苍 turnover in 2010, compared with 拢1.8bn last year. In 2005 it contributed 拢35尘 to operating profit.

Peasland said the construction business was in the top three in education and social housing, and that 鈥渢hese will be the key drivers going forward鈥. In education, Balfour is bidding for the Islington and Newham 好色先生TV Schools for the Future (BSF) programmes. In the north it is bidding for BSF schemes in Stoke and Liverpool, and three weeks ago it was appointed to a six-member national framework for a 拢1.6bn schools academy.

Mansell, the biggest part of Balfour鈥檚 building division, operates as a regional contractor. It is looking to acquire a business in Kent and then in the south Midlands to expand. Since it was acquired by Balfour in 2003 turnover has grown from 拢500m and is expected to hit 拢700尘 this year. The biggest part of the business is affordable housing.

It is part of the BAA framework for Heathrow and Gatwick airports. It is also looking at plans to develop the first Yotels, run by Simon Woodroffe, founder of Yo! Sushi.

Defence is also a big sector for Mansell, and projects include the 拢127m redevelopment of accommodation at RAF Lakenheath. in Suffolk.

A report by Deloitte said that Balfour Beatty had gone from strength to strength and remained the UK鈥檚 biggest contractor because of a successful domestic strategy as well as good overseas investments, particularly in the railway market. It had a 拢4.9bn turnover last year. In a survey of the top 100 biggest construction companies in Europe, Deloitte said that the UK did not feature in the top 10 but dominated the top 100.

Balfour鈥檚 building arm

Turnover (2005) 拢1.5产苍
Turnover forecast (2010) 拢2.2产苍
Operating profit (2005) 拢35尘
Operating profit forecast (2010) 拢67尘
Number of staff 4619
Mansell鈥檚 turnover 拢700尘
Mansell staff 1655