TClarke profits soar thanks to successful landmark projects

Civil engineer TClarke saw pre-tax profits rocket 92% to £7.1m in its most recent trading year, as landmark projects across London and the South-east gave turnover a double digit boost.

Turnover for the mechanical and electrical building services specialist expanded just shy of 12% to £311.2m for the year ended 31 December 2017, as high-profile jobs like the £56m 22 Bishopsgate contract in London sent underlying operating profits from its London and South-east operations to £8.5m, almost three times ahead of the £3m poste a year earlier.

Turnover for the region was also up 24% to £177.6m.

TClarke's operations in the South-west of England returned a £1.8m underlying operating loss on a turnover of £62.6m, citing settlements relating to legacy proects and delays in the start of new jobs for the region's poor performance.

The London-based firm said it was committed to finding "better quality" projects in the South-west and expected the region to return to profit in 2018.

Chief executive Mark Lawrence, said "TClarke is in an excellent position. We are focused on the future and have a clear strategy to deliver on our five key strategic markets."

"We are confident that this will enable us to continue to drive improving returns for our shareholders, as is demonstrated by our setting ourselves the medium-term target to increase underlying operating margin to 3%."

TClarke’s underlying operating margin increased from 2.3% to 2.5%.

Across all regions, the company's order book increased by 12% in the year from £300m to £337m.

TClarke's chairman, Ian McCusker, said, "The strength of our order book is evidence of our significant market share and we are maintaining our discipline and focus to deliver sustained margin improvement across all our regions."

The firm pointed to its increased cash reserves, which grew from £12.3m to £16.7m, as a point of pride, but also noted that its pension deficit had increased to £23.4m.

Earlier in the year, TClarke said in a trading update that it did not "expect there to be any adverse financial impact on the group arising from any direct exposure to Carillion."

Basic earnings per share moved ahead 147% to 13.44p.

As of 1340 GMT, shares had gained 6.83% to 84.50p.