Revenue soars 38% at Mears as repairs hold strong

Revenue at Mears soared 38% in the year ending December 2008, from £304m to £420m, on the back of rising activity in the social housing sector and multimillion-pound contract wins.

Operating profit at the public sector maintenance and repairs firm went from £17.6m to £22.2m, a 26% rise.

In a statement, the firm said that revenue from social housing repairs and maintenance had gone from £205.6m to £282m, growth of 37.2%, reflecting organic growth of 33.6%

Mears said it had won contracts valued at in excess of £460m in total over the past 12 months.

Meanwhile, income from the firm's domiciliary (home) care division rose from £28.7m to £54.6m, contributing more than 10% to organic growth during the year.

Mears has secured 89% of consensus forecast revenue for 2009 and 54% of consensus forecast revenue for 2010.

Chairman Bob Holt said that the firm's order book stood at £1.6bn, with demand for the company's services continuing to be strong.

“Our two growth markets, social housing and domiciliary care, which account for over 80% of group revenues, largely reflect quality partnership relationships with first class public sector customers,” he said.

“These are defensive sectors where spend is largely non-discretionary and which afford us substantial immunity from bad debts. We continue to place great emphasis on winning good-quality contracts that can provide clear and sustainable margins.”