A multi-million pound investment in rail and waste businessess was also responsible

The UK鈥檚 largest demolition contractor, Keltbray, has suffered an 86% drop in profits, blaming the 鈥渨orst market conditions in a generation鈥�.
Pre-tax profit dropped from 拢9.2m to 拢1.3m, while turnover also dropped by 18% to 拢78.5m for the year ending 31 October 2010.

John Keehan, finance director of Keltbray, admitted tough trading conditions had knocked 2-3% off margins, which he said are now at 4-5%.

But the firm said a multi-million pound investment in its rail and waste businesses was also responsible for the dip in profit.

Keehan said: 鈥淥ur 2009 results reflected the tail end of some very good jobs and the fact that staff took a 10% pay cut. Last year there was a substantial investment in overheads and contract margins have come down a bit.鈥�

Keltbray said its target is to grow its rail business so that turnover there matches its demolition business within three to four years. Its fixed assets jumped to 拢7.4m in 2010, from 拢1m in 2009, and it acquired 75% of consultant Aspire Rail last autumn.

A clampdown on overtime pay saw its wage bill fall 5% last year from 拢22.7m to 拢21.6m, despite a staff increase from 548 to 595.
The firm said that acquiring golf and land remediation specialists, Golf Environmental, will diversify the business and help it with landfill.

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