National construction contractor MCS Group has reported turnover of more than £110 million – a £40 million increase on the previous year – and a pre-tax profit of almost £5 million in its 2018 annual results.
The ambitious company reports that it is on course to hit turnover of circa £150 million in 2019 despite uncertainty in the construction sector surrounding the outcome of the Brexit negotiations.
Midlands-based MCS Group is experiencing a sustained period of significant growth as it continues to increase its presence in the industrial, storage and distribution sector while also exploring new opportunities.
Managing director Keir Edmonds said:“The MCS team should take huge pride in the success of the business as it continues to prosper, grow and deliver excellent results both financially and with its delivery of projects. This is only possible by the collaborative approach and team ethic that is applied throughout the structure of the business which is reflected by the high volume of retained customers.”
Highlights of MCS Group’s 2018 annual results include:
- Turnover £110,308,934 – the highest to date
- Pre-tax Profit £4,804,214 – strong profit in a challenging economy
- Margin 4.35% – above industry average
- Year End Cash £23,936,919 – strong cash position
- Balance Sheet total – £8,306,239
- Forward order book – £94,450,000 secured workload for 2019
- Administrative costs £5,326,060 – 4.8% (2017 5.8%)
- Zero Borrowing
Keir added: “The business delivered another great year of growth, breaking the £100m turnover mark, whilst again delivering above industry margin. The group’s business plan continues to deliver organic growth delivered by a highly engaged staff team and an effective integrated supply chain.
“Since 2014 turnover has increased 230% from £33m to £110m. This growth has been consistent, only pausing in 2017 to allow necessary management restructuring to take effect. Our repeat business level remains consistent and strong at 70% which, given the level of growth in the period, demonstrates our reputation and reliability.”
This growth has led to MCS Group becoming the biggest contractor in the motor retail sector as well establishing a firm presence in the industrial sector. Commercial, retail and self-storage sectors remain key areas of delivery and opportunity.
“The group continues to consistently deliver above industry average profits. Whilst profitability is essential, the Board considers the quality of project delivery equally important, as our reputation in the marketplace is paramount.”
Profit margin level remains consistently strong, but the group expects its margins to reflect the tightening industry conditions in the coming period. The business continues to be cash generative and debt free which is reflected by the growth of the balance sheet that sits at a healthy £8,306,239.
At 31 December 2018 secured workload stood at £94,450,000 for 2019, underpinning further growth aspirations with a planned target of circa £150 million turnover for 2019. This could, however, be tempered by both market conditions and economic risks and uncertainties.
Keir added: “Key markets have not been adversely affected by Brexit at present. However, the final nature of the UK’s exit from the EU does represent a degree of uncertainty. The fast track nature of our projects also means that we are not adversely exposed to changing market conditions. The board continue to carefully assess opportunities for further expansion and strategic diversification.
“The continued growth and profit provide reassurance to the board to be able to look at significant forward investment in new headquarters to accommodate the growing dynamic team and business.”
MCS Group recently relocated to a £2.5 million new headquarters in Warwick. It is building a reputation as one of the industrial and warehouse sector’s leading construction companies. The company has also built and refurbished more than 300 car dealerships including Audi, BMW, McLaren and Jaguar Land Rover since its inception in 2003.