Middle East helps drive Interserve profit up 15%

Interserve, the services, maintenance and building group, has announced a 15.3% rise in pre-tax profit, along with £200m of new contract wins in the UK and through its 45% owned associate in Dubai.

In its 2008 annual results, the group posted a headline total operating profit growth of 20%, attributing the rise partly to currency movements and favourable contract settlements in its Middle East construction business.

In health, the group said it had extended its nationwide coverage in the UK health sector by securing a place as one of five contractors on the £600m NHS Scotland Frameworks Scotland programme.

Ringrose: "well placed to deliver another year of progress"

Chief executive Adrian Ringrose said: “2008 was another successful year for Interserve. Whilst the group is not immune to the current economic challenges, with a solid UK position, continued opportunities in the Middle East, a record order book, strong visibility and a robust balance sheet we believe that the group's operations are well placed to deliver another year of progress.”

The new contracts wins annnounced include two UK facilities management contracts, for Ealing council and Leeds Partnership NHS Foundation Trust, and two construction projects in Dubai – an extension to the Mall of the Emirates, and a multipurpose hall for the government engineer's offices.

In Ealing, Interserve was named preferred bidder to deliver a total facilities management contract for 10 years. The contract is worth £5m a year for the core sites.

The contract on behalf of Leeds Partnerships NHS Foundation Trust is through Equitix, which as part of a PFI project owns and operates seven sites in Leeds providing a range of mental health services.

The Middle East contract wins were awarded to Khansaheb Civil Engineering, in which Interserve has a 45% stake.

The group is to undertake a £50m extension of the Mall of the Emirates, which it originally built. Owner Majid Al Futtaim plans a four-storey extension and a link to the Dubai Metro public transport system.

Meanwhile, the multipurpose hall being constructed for the government engineer's office will feature a clear-span area of 120m², capable of being divided into four individual event areas using sliding partitions. Together with associated car parks, roads, loading bays, external works and landscaping, the project has a value of approximately £50m.

Adrian Ringrose said: “These wins demonstrate that there are good opportunities in our markets, both in the UK and the Middle East. The sectors we are focused on are resilient and we are reaping the benefits of our strategy of developing long-term client relationships.”