Profit slides at major contractor as it targets £500m turnover

McAleer & Rushe has reported a fall in profit as it unveiled turnover targets for 2025.

The Northern Ireland-based design-and-build contractor tabled a pre-tax profit of £11m for the year to 31 December 2023, a slight decrease on the £12.1m for the previous year. Its pre-tax profit margin therefore decreased from 3 to 2.5 per cent.

This was despite an increase in revenue to £436.4m, in comparison with £404.4m a year earlier. McAleer & Rushe said this was due to a number of sizeable contracts that it completed in 2023, including a £52m job to develop a 15-storey Premier Inn hotel in Birmingham and a £42m student accommodation scheme in Norwich.

McAleer and Rushe managing director Martin Magee told Construction News the decrease in profit was due to the “impact of price inflation within the latter stages of contracts.

But he said there had been “no change in our supply chain payment pattern”, evidenced by the increase in cash position, which came in at £53.1m compared with £45.2m at the end of 2022.

The company said its revenue “will increase to reach £450m” in 2024, while it is targetting £500m in 2025. The company said the projected increase was partially due to a strong start to 2024, with site starts on more than £350m worth of contracts so far.

“These contracts are majority residential and of above-average size, and will contribute to further growth in turnover to £500m-plus in 2025,” the firm said.

Those jobs include two from March – a £76m job to build an integrated retirement community in Kent (pictured), and a £100m mixed-use scheme in the centre of London.

McAleere & Rushe also released a dividend of £6m and increased its director payments from £1.3m to £2.1m.

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