26.06.18

Pre-tax profits at Sisk rise by 73% to €24.7m

John Sisk & Son (Sisk), the innovative, engineering and construction company with extensive operations across Ireland, the United Kingdom and mainland Europe, has today announced full year financial results for the year ended 31 December 2017. 
 
Performance:
Sisk is pleased to report a strong outcome for 2017 in both profitability and business development.   The results reflect a very robust performance in Ireland.  No loss-making projects were reported by the business in 2017.
 
Turnover decreased in the year to €792.2m.  The business reported a pre-tax profit of €24.7 that incorporates an exceptional item of €11.4 relating to an associate company reaching a settlement in relation to historic construction contracts.
 
Financial highlights:
 Pre-tax profits increased by 73% to €24.7m                                                   (2016: €14.3m)
 Turnover decreased by 5% to €792.2m                                                          (2016: €833.7m)
 Total equity of €88.2m                                                                                     (2016: €74.3m)   
 Net cash at year end of €97.1m                                                                      (2016: €95.4m)
 
Commenting on full year performance for 2017, Stephen Bowcott, CEO of John Sisk & Son said:
 
“Our engineering and construction business enjoyed a successful year in 2017, where performance reflected strong levels of activity, particularly in areas such as data and technology, life sciences and biopharma, advanced manufacturing, commercial, retail, residential and civil engineering.
 
 “The focus we brought to the business in 2017 was around value generation - for our customers, our people and our shareholders. This meant a shift from being a revenue led business to being a profit led business working with key partners to generate greater productivity in the industry leading to better outcomes for our customers. The results of this approach are clear across the business where I’m happy to report that Sisk recorded no loss-making projects in 2017 for the second consecutive year. Our focus on value generation, our commitment to safety and the environment and our ongoing investment in our people has paid dividends in 2017 and positions the business on a strong platform for future sustainable growth.
 
“We continue to be selective about the projects we undertake.  Sisk has the financial platform and skilled people to compete for business across key sectors based on high quality, timely, cost efficient and safe project delivery.
 
“We were proud to host the inaugural Sisk Supply Chain Awards in late 2017, celebrating our key partners in the supply chain both in Ireland and the UK.  There is a strong order book for 2018 and combined with our focus on value creation for key stakeholders, and sustainable profits, the business looks to the future with confidence.”      
 
Strategic focus:
Based on a strong commercial and operational platform, Sisk’s strategy is to create value for its customers, shareholders and other stakeholders by continuing to deliver complex projects in key sectors.  Sisk offers the full range of project delivery services where quality and value is integral to everything the business does while collaborating in partnership with its clients and business partners to deliver world class innovative results. The key to creating value has been in shaping the project delivery in order to introduce innovation at an early stage, using digital tools to understand the challenges of each project and bring about a very strong programme focus to create as efficient an environment as possible for all those who work on our projects.  Sisk has been on the Lean journey since the late 1990s but undertook a step change in approach in 2016, recognising how core Lean principles matched the company’s focus on delivering value for customers and respecting and creating an efficient, sustainable, safe and rewarding environment for all those who work with them. 
 
Operations review:
Building on the strengthening performance of the business over the past number of years, 2017 was another year where Sisk completed and were appointed to, key landmark projects.
 
The €70m redevelopment of Pairc Ui Chaoimh was successfully handed over to the GAA in 2017 and earned Sisk two honours at the Irish Construction Excellence Awards.  Sisk’s civil engineering business completed several of Ireland’s substantial projects including the Cross-City Luas extension in Dublin and the N17 Gort to Tuam Motorway. 
 
The business was selected by Center Parcs to build 470 lodges and 30 apartments at its Longford Forest Resort in addition to the holiday village’s central building that includes swimming pool, bars, restaurants, and retail outlets.
 
Sisk continued to successfully deliver three strategically important Data Centres in Dublin marking its tenth year of project delivery in this sector.
 
Other significant contracts underway include the redevelopment of the Curragh Racecourse, which was secured using innovative construction methods where the business developed the first BIM Virtual Reality model in Ireland, and also the landmark Capital Dock mixed use development for Kennedy Wilson on Dublin’s South quays.  The business also recently turned the sod on the major Grangegorman educational campus for the Dublin Institute of Technology and are delivering a major expansion of the Bons Secours Hospital in Cork.
 
Sisk Living, which was established in 2016 up as a specialist Housing delivery division of Sisk to deliver good quality, energy efficient houses quickly, and based on volume delivery, was successfully appointed to two affordable housing contracts, the first of which was delivered in Dun Laoghaire in May 2018, with the second for South Dublin County Council due to be delivered over summer this year.  The business has proven that builders on a design, build and finance basis can deliver homes at a far lower cost than developers who take the risk of speculatively purchasing land up front based on securing large profit margins.
 
Following a number of challenging years impacting the entire industry in the United Kingdom, Sisk successfully returned its business to profitability in this market and delivered key projects during the year including the major redevelopment and restoration of London’s iconic Royal Academy of Arts.  It was also successful in securing other landmark projects such as an £88m hanger for Boeing at Gatwick and the £190m fourth phase of Great Ormond Street’s redevelopment programme.  Sisk, using its experience of building the National Conference Centre in Dublin, is also the primary contractor on the International Convention Centre Wales in Newport and continues to be the primary partner of Quintain in their major redevelopment at Wembley Park as we build out the largest build to rent programme in the UK.  At present Sisk is delivering over 3,000 residential units in the UK market, a core skillset which can be used to solve the housing issues we face at present in Ireland.
 
The Irish based business has also expanded its footprint into European business this year working in programme management and project delivery for some of its key long-term customers across the Nordics, Benelux, Austria, Germany and Switzerland.  These projects are a core part of our strategy and we see this as a particular area of growth over the coming years.