The Construction Top 100

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Detailed analysis of the Top 100 construction contractors in the UK in 2008

The very nature of CN's Top 100 contractors listing is that it looks back into the past, bringing together the figures from annual reports based on work done, many months or even years ago.

While Construction News attempts to keep the data for our annual round up as current as possible, it is constrained by the fact that there are contractors in the list whose most recent results date back as far as 2006, as they dawdle through the process of submitting their annual accounts to Companies House.

In most years this hasn't really been a problem. With booming workloads across the industry, the failure to submit prompt records has only affected the companies themselves, as they perhaps lost out on a higher placing in the table.

But, in the 12 months since Construction News last published this list, there has been a sea-change in the economy. It was in the very same week that the 2007 supplement was hitting the news stands (13 September) that the management of Northern Rock knocked on the door of the Bank of England, asking for help to shore up the failing institution. The downturn that followed has threatened the industry with a return to the recessionary conditions last seen in the 1990s.

On the face of it, the results of the Top 100 suggest that these fears are not yet being realised. Figures for turnover, profit and employment are all up on 2007 results, while stellar performances prior to the beginning of the downturn have made some firms look very healthy indeed. We may have to wait until the Top 100 of 2009 to see what effect the apparent slump in the industry is having.

But perhaps not. The varying haste at which firms are submitting their formal reports and accounts offers an opportunity to dig just a little deeper.

For the first time, Construction News has split up the 100 biggest companies, not by the size of revenue or profit, but by the date of their latest accounts. By contrasting the results gathering dust with the reports and accounts that are still warm from the printing press, it can be argued that the credit crunch is already proving itself.

Results dating back to the 2006-07 financial year show growth in year-on-year average employment and turnover at a relatively low level, while those from April to the end of 2007 show growth is stronger.

Around a third of those firms in the Top 100 posted results dated 31 December 2007, and again there was a boost in annual revenue and employment growth compared to the previous two groups.

But 'the crunch' is perhaps evident for those companies whose accounts have a 2008 date, where a significant drop in the levels of growth is apparent (see bar chart, in the resource box on the right hand side of the page). 

Average annual employment growth for these firms is just 2.5 per cent, compared with more than 19 per cent for those that reported on the last day of 2007, while growth in turnover is below 10 per cent compared with 24 per cent for the earlier group.

And while profit growth remains broadly steady at around 30 per cent, even here the figures show a downward trend from the bonanza days of 2007.

As always with statistics, there must be caveats. Given the time it takes for even the most efficient contractors to put together their annual reports, it is no surprise that only a few have submitted 2008 figures. Given this small sample, there is the possibility that this early evidence of the downturn's impact could turn out to be an anomaly.

But it is certainly worth keeping an eye on the numbers as the latest results from major contractors are published. If the trend shown by these early figures continues, it may turn out that the solid performance shown by this year's Construction Top 100 represents one last hurrah ahead of some leaner times to come.