Profits tumble by a third at Co Derry construction firm
CO Derry-based construction firm Heron Bros has seen its profits tumble by a third in what has been described by directors as a year of consolidation.
According to the latest accounts published on Companies House, pre-tax profit at the Draperstown company slumped from £12.8m to £8.6m in the 12 months to February 28, while turnover fell by 21 per cent from £94.8m to £74.6m over the year.
Staff numbers increased marginally to 248 on average from 244 in 2017. This is turn led to a 7 per cent increase in the company's annual wage bill, which has risen from £9.4m to just shy of £10m
In the strategic report accompanying the company accounts, the Heron board said that following "significant expansion" in the previous year it considered it "prudent to consolidate the company's growth during 2018 in preparation for future expansion in 2019".
"During this period the board introduced changes to the company's workforce, structures, operational procedures and audit controls to consistently identify, evaluate and effectively manage the risks the company is exposed to," they said.
Following a group restructuring of family shareholdings, Heron Bros now controls and is responsible for the management of a property portfolio, which the company says provides a "sustainable annual profit", while it also has benefitted from the first receipt of interest payments from renewable energy business, Simple Power, which it invested in.
Simple Power and its portfolio of 52 wind turbines has since been sold to UK infrastructure and private equity investment manager, the Foresight Group, in a deal concluded in October.
Looking ahead Heron has outlined expansion plans, however these will be measured and focused predominantly within the UK.
"With continued uncertainty at a local and national level and to avoid spending troughs, the company will have a renewed focus on the UK market," the directors said.
"We are however encouraged by a strong balance sheet, order book and opportunities for the year ahead. This will be done as always, in a controlled manner to ensure that key issues such as health and safety, customer service, business reputation and margin are not compromised in any way."
Heron Bros is a family owned business formed by six brothers in 1956 in Draperstown.
Under the current leadership of managing director, Damian Heron the company has expanded its construction, land and property and manufacturing operations across the UK, Ireland and Europe.
Recent major projects include the £4.5mPorsche Centre at Titanic Quarter, which opened in December last year.