Press release 31/08/1999 00:00 CET

Increases in turnover and profit revealed in Kvaerner Construction’s half year results announced today show that the company is achieving its target for steady growth.

Profit before tax and goodwill of £9 million shows an increase of 37 per cent in the second quarter (Quarter 1- £3.8 million) by the company’s main contracting and specialist businesses. The company’s underlying profits have also increased, showing a 1.6 per cent margin on sales in the second quarter against 1.3 per cent in the 1st quarter. Work in hand has remained steady.

Chief Executive Keith Clarke said: "Our order book is holding up well but it is performance that counts in the current marketplace. Our profits are up on the first quarter of the year, and our efforts to improve performance are showing in the continual trend upwards.

"PFI work continues to be one of our strengths with two major schemes moving towards financial closure later this year. We have completed a design and construct contract for a secure training centre at Medomsley in just 41 weeks while work at Pucklechurch Prison near Bristol and at the Chepstow Community Hospital are progressing well towards completion at the year end."

New orders won during the second quarter include contracts worth £65m for an office/retail development and associated works in London and in Scotland two orders, jointly worth £30 million, include a major office development in Edinburgh and a new museum in East Kilbride. Further work with Railtrack was won by the civil sector and inroads have been made into the recently deregulated European mobile communications market with a contract to install radio base stations in Holland .

The market in Hong Kong continues to hold up with Gammon securing a further £100 million worth of work in the second quarter.

Half Year

· Turnover £621 million 8% growth in 2nd Quarter

· Operating profit £4.1 million 73% growth in 2nd Quarter

· Profit before tax and goodwill £9.0 million 37% growth in 2nd Quarter

· Order book £1.50 billion (£1.52 billion at Quarter 1)

(Figures include Kvaerner Construction’s share of associates including Gammon Construction)