Member Article

Esh Group reports strong results as post-Brexit construction uncertainty looms

Esh Group CEO Brian Manning has warned of uncertain times lying ahead for the construction sector, following the UK’s decision to leave the EU.

Reporting healthy results for 2015, the firm generated £275m in turnover and £8.6m in pretax profit, while cash balance was £29m.

The Durham-based firm, which has offices in Yorkshire, Cumbria and Scotland, employs more than 1,200 people across the North and in Scotland with the majority of its work conducted within the North East.

A pillar of the region’s construction industry, projects completed during the year by Esh included the £5.4m Thirteen headquarters in Stockton, the £7.4m STEM Skills Centre at Middlesbrough College,the £3.3m Boho Five scheme in Middlesbrough and the £5.4m Fusion Hive, Stockton Innovation Centre.

Moreover, the firm won significant work in 2015 including a ten-year contract to carry out work on Northumbrian Water’s water and wastewater networks.

Brian Manning, CEO, said: “This is a good performance and a credit to the hard working employees and supply chain partners.

“These results show a successful, diversified strategy which is working not just to the benefit of our own employees, supply chain and customers but also the communities in which we operate.”

The Group’s Esh Property Services business was also appointed to the four year Broadacres Framework, a £160m scheme which involves the construction of 1,600 homes in the North East and Yorkshire over four years.

Development performance with Esh Homes and Esh Developments improved in 2015, as planning permission was secured for 450 houses and retail development at Philadelphia in Sunderland. Work on this site will start in 2016 and provide revenues from 2017 onwards.

Brian added: “Esh Group is well positioned to lead the new opportunities with our partners once areas such as devolution and the EU are more settled.”

Despite Esh’s positive results for the year, Brian indicated that uncertainty lies ahead in the North East construction sector, following Brexit.

A growing area of concern for businesses across the region, the North East is yet to hear how European funding will be replaced.

Brian continued: “It’s a big area of concern. A lot of North East projects receive European funding, some of our proudest buildings like The Sage and Live Theatre wouldn’t have happened without it.

“What will it be replaced with? We don’t know the answer to that and it’s too early to identify what will happen, so we’re certainly keeping a close eye on what’s going on.

“The North East plays a massive part in our growth,a round £200m of our turnover comes from the work we do here. We just have to persevere.”

Like many in the region, Brian hopes that swift decision making will soon ensue to shorten uncertainty and pave the way for busienss porsperity.

He added: “These are interesting and fascinating times we’re living in but perhaps business could have done without them? The value of our brand reputation in the North East remains a great strength for us but the sooner decisions are made, the better the future will be for us.

“I see the quick change in Tory leadership as a good thing, next we want to see devolution back on track int he North East, which could be a massive factor in the region getting more from central government.”

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