Construction firm BAM increases revenue from private contracts
Turnover up 15 per cent as large builder continues to reduce focus on public works
Theo Cullinane, chief executive of BAM Ireland: “Experience in recent years has shown that the new forms of contract for public works in Ireland have proven adversarial rather than partnering in nature.” Photograph: Michael Mac Sweeney/Provision
BAM Ireland, one of the country’s largest construction businesses, said it continued to reduce its focus on public works last year because of the difficulty of operating the contracts involved.
Formerly known as Ascon, BAM increased its turnover by 15 per cent last year to €353 million, although its pretax profit of €6.3 million was down €1.2 million on 2013, mostly because of increased cost of sales. The profit margin was 1.8 per cent.
The company’s principal activities are civil engineering and main building contracting, and its main market is the Republic. BAM said it continued to reduce its focus on public works, increasing its revenue from private contracts by 34 per cent.
“While we continue to invest strongly in Public Private Partnership (PPP) projects, we also significantly grew our private sector business,” said chief executive Theo Cullinane.
“This is in line with our strategy, as experience in recent years has shown that the new forms of contract for public works in Ireland have proven adversarial rather than partnering in nature.”
He said the company would welcome the timely adoption of internationally accepted forms of contract to alleviate the issue “as progress with reversing the contentious conditions is proving too slow”.
However BAM said in its accounts that it expects to continue to see substantial amounts of work coming from PPPs.
BAM has recently been appointed as preferred bidder on PPP projects on the N25 New Ross bypass and Schools Bundle 4. Its private projects include work for Glanbia and Dairygold. “Our order book is solid across all sectors and our expectation is that 2015 will be another progressive year,” Mr Cullinane said. He added that BAM’s investments over the years had leveraged more than €1.5 billion of work, creating upwards of 15,000 jobs.
BAM Ireland is also working on contracts in Dubai. It had an average of 705 employees in 2014, at a cost of €47.2 million. The company’s parent is Royal Bam Group, in the Netherlands.