Laing O’Rourke made a profit before tax of £18.1m in the year to 31st March 2024 on group revenue up 18% at £3,990m.
The previous year it had made a pre-tax loss of £288.1m on £3,341m group revenue.
That 2023 loss included more than £195m of exceptional items, most of which were claims provisions, including a long-running dispute over a contact in Australia completed in 2017.
This year, exceptional items have been kept below £40m, including £5.6m of redundancy costs and £19.6m for putting right defects under the Building Safety Act 2022.
This year’s results show pre-exceptional earnings before interest and taxation (EBIT) of £75.6m and post-exceptional EBIT of £40.0m.
The Australian business continued to perform strongly, the company said, and in the UK the business has overcome a period of record inflation that had impacted the profitability of fixed-price contracts.
Laing O’Rourke generated net cash of £278.5m last year and grew its order book from £10.0bn at the start of the year to £10.8bn by the end – the largest it has ever been.
Group chief financial officer Rowan Baker, who leaves later this month for a new job elsewhere, said: “These results show significant improvement in our group performance. The business has returned to profit and is recovering well from an unprecedented set of challenges in FY23. We have grown group revenue significantly, by 18%, have strong net cash of £278.5m and added another £800m to the order book. Allied to our refreshed group strategy, which is reducing our exposure to market events beyond our control, these accounts give the business reason to be confident about the future.”
Cathal O’Rourke, who took over as chief executive from his father Ray in July, said: “I am delighted to confirm a return to profit for our business. This provides stability and a platform from which we can keep building certainty and resilience. I’m particularly pleased that we continue to win work in our priority sectors in both operating hubs – it assures me we have the right strategy in place to de-risk our portfolio and achieve long-term sustainable growth.
“Delivering these results has taken a huge amount of work by our people and I want to thank them for their hard work and commitment.
“There remains much for us to do to unlock the full potential of our business and transform the industry so that it can deliver the buildings and infrastructure governments in the UK and Australia need to keep their countries secure, make the energy transition and protect the health of their citizens. We have the people, experience and technologies to deliver these essential works in a better way, and that makes us excited about the future.”
Rowan Baker’s replacement as CFO is her deputy, Paul Teasdale, who joined Laing O’Rourke in 2018 from Lendlease and previously spent nine years at American Express.
Laing O’Rourke chair Sir John Parker said: “This recovery has been achieved despite ongoing market turbulence, which makes it more impressive. I am confident we have in place the right strategy, refreshed leadership, and a new organisational structure to keep building certainty and resilience.
“As she returns to work for a listed company, I want to extend our thanks to Rowan Baker. She has been our CFO during a volatile period and has helped the business navigate the impacts of the pandemic and unprecedented inflation. We wish her well.”
Rowan Baker added: “It has been a privilege to be part of Laing O’Rourke for the last four years, working with exceptional people to deliver projects of national importance.”
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