Contractor plans to double profit with PFI investments and property development

John Sisk is looking to break into the PFI equity market as part of ambitious expansion plans for the next three years.

At present the contractor just works on the construction of PFI projects. It is now planning to take a stake in the resulting buildings, and is also looking to set up joint venture property development vehicles.

Pierce O鈥橲hea, the managing director of Sisk UK, said: 鈥淲e have been asking: 鈥楬ow do we grow our margins?鈥� In the long term, equity provides better margins. Shareholders also like it if you have equity stakes.鈥�

O鈥橲hea said the group was looking for partners on the PFI and the property development sides.

O鈥橲hea said that over the next three years he wants to see a 50% growth in turnover and a 100% growth in pre-tax profit.

For the year ending 31 December 2005, pre-tax profit was 拢3.7m, on the back of 拢250m turnover. O鈥橲hea is expecting profit before tax to rise 20% to about 拢4.4m for the 2006 financial year.

Geographically, Sisk鈥檚 growth plans are centred on expanding its regional offices in Manchester and Bristol.

O鈥橲hea said: 鈥淲e want to be the biggest player in these cities. At the moment we have about 30-40 people there and we want to increase that to up to 70 over the next three years.鈥�

Sisk has five offices in England altogether, including its head office in St Albans, Hertfordshire.

What are not in Sisk鈥檚 medium-term plans are acquisitions; O鈥橲hea said the firm鈥檚 growth would be purely organic. Sisk last made an acquisition in 2004 when it bought Bideem, a 拢33m-turnover Bristol contractor which specialises in rail and civils.

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