BAM reports strong UK profits as falling pound affects revenue

bamProfits at the UK operations of BAM more than quadrupled to nearly £16 million in the first six months of 2016, though the lower value of the pound has impacted on revenue, results and closing order book.

The Dutch construction group said the falling pound accounted for more than half of the fall in first-half revenue which slipped 3 per cent to £916m compared to last year.

Reporting an otherwise good first half performance in the UK, Rob van Wingerden, CEO of Royal BAM Group, added that BAM had undertaken a thorough assessment of the implications of Brexit, and saw no material effect in the short term.

He said: “Since the Brexit vote, the only effect on BAM has been the translation of the weaker pound. Our UK order book is solid and we will maintain our tender discipline. We are monitoring new order intake closely and will adjust our operations if required.”

The UK is the BAM’s second-largest market after the Netherlands and accounted for 31 per cent of the revenue in 2015. The fall in the pound reduced the reported revenue from BAM Construction and BAM Nuttall by around £55m.

As a result of the improved trading performance UK group margins were restored to 1.7 per cent compared with just 0.3 per cent the year before.

Much of the profit growth was driven by BAM Nuttall and PPP activities after BAM Construction suffered small losses on closing a few projects.

The combined UK order book stands at £2.3 billion, with virtually all forecast revenue for this year secured.

BAM appoints Scottish regional director

Bruce Dickson

Bruce Dickson

Bruce Dickson has been appointed as the regional director for BAM Construction in Scotland, succeeding Douglas Keillor who has stepped up to the board position of executive director of BAM Construct UK Ltd.

Bruce graduated from Edinburgh University in 1988 and worked for the major projects division of an international contractor prior to joining BAM in 1992 as a project surveyor. He held various roles in the business before becoming the commercial director for Scotland in 2009.

Bruce is a member of the Construction Scotland Industry Leadership Group and currently chairs their Procurement Implementation Group consulting with the Scottish Government on the implementation of the Procurement Review White Paper. He has been a guest lecturer at the University Of Edinburgh School Of Architecture since 2008 and sits on the board of the Scottish Contractors Group. He is a Fellow of the Royal Institution of Chartered Surveyors.

Both Bruce and Douglas take up their positions on 1 August 2016.

Doug Keillor

Doug Keillor

Douglas, who became regional director in 2013 and has 28 years’ service with the company, has been instrumental in spearheading a number of high profile projects including the V & A Museum Dundee and the new Imaging Centre of Excellence at the Queen Elizabeth University Hospital. In his position as a Board member, Doug will be joint managing director of BAM Construction with particular responsibility for the construction divisions in Scotland, the West country and the South East of England. He will also lead on health and safety.

Graham Cash, chief executive of BAM Construct UK, said: “Douglas and Bruce are both highly skilled leaders and have the experience, energy and focus the business requires particularly as the industry faces new challenges ahead.  It’s an exciting time for BAM in Scotland as we look forward to the completion of the V & A Dundee in 2018, among other projects.”

From 1 August 2016, the Board of BAM Construct UK Ltd comprises Graham Cash, chief executive, James Wimpenny and Douglas Keillor.

BAM delivers new Fife community campus

WindmillCommunityCampusExteriorBAM Construction has successfully handed over the new £21.5 million Windmill Community Campus in Kirkcaldy.

The school is the final project to be built under the Building Fife’s Future Framework which delivered Dunfermline High School in 2012 and Auchmuty High School in 2013.

Located on Windmill Road, the new building will house Viewforth High School with accommodation for up to 600 new pupils when it opens its doors for the new term on 17th August. Facilities include state of the art teaching spaces with integrated technology, a new sports centre and library, available for community use, and a local office for Fife Council.

WindmillCommunityCampusInteriorAlso moving to a new home on the campus is Fife’s celebrated Rosslyn School. Their new purpose built facility was designed in partnership with the school’s specialist teachers and includes a large, fully equipped sensory room along with a number of quiet rooms where intensive interaction can be facilitated with minimal distraction.

Doug Keillor, regional director, BAM Construction, said: “Windmill Community Campus is an inspiring and innovative building and a fine example of how a strong public and private sector relationship can deliver a first class building, on time and within budget, that will greatly benefit the local community.”

Windmill Community Campus is the 18th education project to be delivered by BAM Construction in Scotland in the past seven years and BAM is still on site in Fife working on the new Levenmouth Academy and the Waid  Community Campus, in Anstruther, both being delivered under a partnership between Fife Council and hub East Central Scotland.

Kirkcaldy area chair, Cllr Neil Crooks, described the purpose of the new community campus and the benefits for the community and the council.

He said: “This is an exciting time in Fife as we near the completion of both Windmill Community Campus and Levenmouth Academy, with the new Waid campus due to open next summer.

“This is a new way of working for the council where we are able to provide state-of-the-art high schools which will incorporate a range of community facilities, all under one roof. This community approach has a range of benefits for pupils, parents, the wider community and the council.”

Douglas Keillor to replace Richard Bailey on BAM Construct UK board

Douglas Keillor

Douglas Keillor

Regional director of BAM Construction in Scotland, Douglas Keillor, has been appointed to the board of BAM Construct UK.

Keillor will join as executive director and replace managing director Richard Bailey who is stepping down on 1 August after a career spanning 39 years.

Douglas Keillor has 26 years’ service with the company and has been regional director of BAM Construction in Scotland since 2013.

A successor to Keillor in Scotland will be named later in the year.

Mr Bailey said that “the time is right” to pursue other interests outside of BAM.

Chief executive Graham Cash said: “Richard Bailey joined the company in 1977 and rose steadily through construction management becoming regional director of BAM Construction in Western in 1995. In 2007, Richard was appointed to the board of BAM Construct UK.

“In all of these roles Richard has been a tremendous supporter of people and he has been a pioneer of countless new ideas from developing sustainability to Zero Harm to lean to collaboration.

“Many people in the company regard Richard as a friend and mentor and he will be missed by all. I want to take this opportunity to thank Richard for giving so generously to the company, especially since 2007 when he has travelled the length and breadth of the regions, barely seeing home from a Monday to a Friday.”

With effect from 1 August 2016 the management of BAM Construct UK Ltd consists of Graham Cash, Douglas Keillor and James Wimpenny.

Work begins on delayed West Dunbartonshire high school

OLSP3Work has officially started on a delayed £25 million secondary school in Dumbarton.

Our Lady and St Patrick’s High School was one of 12 government projects across Scotland delayed while civil servants sought technical advice over the funding arrangements.

Work on the new school by BAM Construction is expected to take 18 months with the first pupils set to be welcomed to the building in October 2017.

The three-storey school, which is being built on West Dunbartonshire Council-owned land in Bellsmyre, will accommodate 1000 pupils and feature state of the art classrooms, an ICT suite, construction skills area, hospitality kitchen, outdoor teaching spaces and an allotment garden.

OLSPThe facility will also include a floodlit all-weather sports pitch for football and hockey, three outdoors games courts, a fitness suite, gyms, games hall with retractable bleacher seating and a flexible social space incorporating a performance area. All of the facilities will be available for community use outwith school hours.

S1 pupils Michael Harkin; Erin Lynn and Evie McEwan joined educational services convener Michelle McGinty and depute convener John Mooney to break the ground at the site and officially mark the start of work on the project.

Councillor Michelle McGinty said: “This project is about improving the life chances of our children and young people and providing them with a school which will fully support their learning, attainment and achievement. In reality the whole community will benefit from the fantastic facilities which are being developed on this site.”

Councillor John Mooney added: “As a council we’re committed to ensuring that our young people are educated in the best possible facilities. When the new Our Lady and St Patrick’s is constructed it will also complete the full regeneration of our mainstream secondary school estate moving thousands of pupils into buildings which fully support their needs and aspirations.”

New chair at the helm of the Federation of Piling Specialists

Alasdair Henderson

Alasdair Henderson

The Federation of Piling Specialists (FPS) has appointed Alasdair Henderson as its new chair.

Presently divisional director of BAM Ritchies in Kilsyth, Alasdair replaces Martin Blower who has completed his statutory two-year tenure at the helm.

In addition to the Federation’s core aims and goals, Henderson will focus on training, which is one of his big interests, as well as developing a route for pilers / geotechnical specialists to become professionally recognised as EngTechs, ideally through vocational routes recognised by the major engineering institutions.

Speaking about his role with the FPS, Alasdair said: “It is an honour to be appointed as chair of the FPS as its status and respect within the specialist contractors sector is extremely high. It is also encouraging to be a chair from outside the mainstream foundation industry, as it demonstrates the FPS’s role in championing the full range of ground engineering specialisms.”

He added: “Training is my ‘thing’ which goes hand-in-hand with my mission to see geotechnics recognised widely as a highly skilled industry.”

Alasdair’s knowledge of the piling and foundation / specialist contractor sector is vast having more than 20 years’ experience working for BAM Ritchies, the specialist ground engineering division of BAM Nuttall Ltd. He is also a divisional director of BAM Nuttall and sits on its engineering board to support technical delivery and promote research and development initiatives across the business.

Alasdair’s enthusiasm for learning and development and in promoting the professional recognition of those with non-traditional educational backgrounds is well known in the sector. He holds the appointment of Visiting Professor at Strathclyde University’s Department of Civil and Environmental Engineering, and is a member of the International Advisory Group for the DISTINCTIVE consortium of universities undertaking research into nuclear decommissioning.

On a technical level Alasdair’s interests cover the geotechnics of underground infrastructure, particularly relating to injection grouting and the management of radiological waste.

Green light for delayed £25m school in Dumbarton

OLSPBAM Construction could begin work on the new Our Lady and St Patrick’s High School in Dumbarton within weeks after councillors agreed to conclude contracts for the project.

Members of West Dunbartonshire Council’s infrastructure and regeneration committee yesterday gave their approval for the development to proceed to financial close by 31 March.

The new £25.9 million secondary school in Bellsmyre is likely to be on site next month and could be open to pupils as soon as October 2017.

The school was one of 12 government projects across Scotland delayed while civil servants sought technical advice over the funding arrangements. The issue was resolved late last year and council officers have been working hard behind the scenes to get the project ready for financial close as quickly as possible.

The 1000-pupil school, which is being built on council-owned land in Bellsmyre, has already been granted planning permission so work can begin as soon as contracts are concluded.

The school will feature state of the art classrooms, which will fully support the Curriculum for Excellence, an ICT suite, construction skills area and hospitality kitchen as well as outdoor teaching spaces and an allotment garden. The facility will also include a floodlit all-weather sports pitch for football and hockey, three outdoors games courts, a fitness suite, gyms, games hall with retractable bleacher seating and a flexible social space incorporating performance space. All of the facilities will be available for community use outwith school hours.

The new three-storey school will be fully accessible for disabled pupils and staff with every subject having one teaching room equipped with height adjustable furniture and fittings and an induction loop top support those using hearing aids. In addition the building will incorporate lifts to each floor, ramps and wheelchair accessible toilets.

The school will also have significantly lower energy costs and carbon emissions than the current building.

Councillor Michelle McGinty, convener of educational services, said: “This is great news. Pupils, parents and staff have waited a long time for this new school and I’m delighted that we are now set to go on site and finally begin building a new our Lady and St Patrick’s High School. This new school will not only improve the educational experience of OLSP pupils but will benefit the whole community who will be able to access the fantastic facilities.

“Building a new OLSP has remained a top priority for this council and will mark the completion of the regeneration of the secondary school estate in West Dunbartonshire which has moved thousands of young people from sub-standard buildings into modern, purpose built learning environments.”

The development is being fully funded by the Scottish Government. The council has set aside £550,000 over the next two years to cover costs which are not associated with the construction including the demolition of the existing school in Castlehill.

Five construction firms shortlisted to restore Mackintosh Building

Image of the Mackintosh Building from Renfrew Street looking towards Sauchiehall Street

Image of the Mackintosh Building from Renfrew Street looking towards Sauchiehall Street

A shortlist of five companies has been drawn up for the £35 million restoration of the Mackintosh Building at the Glasgow School of Art (GSA).

Balfour Beatty Civil Engineering Ltd, BAM Construction Ltd, John Graham Construction Ltd, Kier Construction and Sir Robert McAlpine Ltd are battling it out to restore the Category A Listed building which was destroyed by fire in May 2014.

A winner is expected to be appointed in June with work starting on site shortly after.

Sectional views of the west wing

Sectional views of the west wing

Architects Page/Park have already been announced as the design team who will lead the restoration.

Meanwhile new images have been created by experts in 3d visualisation at the GSA’s Digital Design Studio, created by laser scanning of the building.

They will form the basis of a BIM (Building Information Model) which will document every stage of the restoration and create a detailed record of the work undertaken for future use both by the GSA and other organisations carrying out complex restorations of historic buildings.

Final preparation work including the strip out of the fire damaged west wing is currently underway and will be completed by the end of May.

A 3d image of the former professors studios. This is one of a set of images created by experts in  3d visualisation at the GSA's Digital Design studio that will form the basis of a BIM  (Building Information Model) which will document the restoration process

A 3d image of the former professors studios. This is one of a set of images created by experts in 3d visualisation at the GSA’s Digital Design studio that will form the basis of a BIM which will document the restoration process

The GSA is aiming to complete the restoration of both the Mackintosh Building and the McLennan Galleries in time for the 2017/18 academic year.

The school said the removal of the stonework comprising the library window gable will be among the first jobs to be undertaken, followed by reconstruction of roofs which were totally destroyed in the fire.

Liz Davidson, senior project manager, Mackintosh Restoration, said: “Clearly we need a contractor who is able to deliver the full range of technical requirements for the retrofit and has a proven track record in bringing major restoration projects in on time and on budget.

“However, over and above this we are looking for the inclusion of experienced specialists who are capable of undertaking the expert restoration of this Category A Listed building.

“We are looking for our Main Contractor to have the appropriate expertise in their team to deliver to the highest standard in terms of the specialist skills.”

The contractor will also be required to commit to an extensive programme of recruiting and training apprentices to support Glasgow’s economy, as well as deliver education and outreach programmes in the area.

BAM to broaden services with new energy division

Reid Cunningham

Reid Cunningham

BAM Construct UK has set up a new energy subsidiary within its facilities management division.

BAM Energy Limited will offer customers design, installation, management and maintenance of energy-efficient systems, as well as support with finance.

Reid Cunningham, interim managing director at BAM FM, and the driving force behind BAM Energy, said the purpose of establishing BAM Energy is “to broaden our services and offer customers more choice”.

He said: “We find that clients are often unaware of green energy options or daunted by the up-front capital investment. Using our expertise, we can help them find the best energy option and facilitate its implementation.”

BAM Energy funds the design and installation of sustainable energy systems (such as biomass heating systems, Combined Heat and Power (CHP), photovoltaics (PVs) or heat pumps) on behalf of a client during the construction phase of a new building. The cost is then recovered over an agreed period of time through a power purchase agreement, whereby the client buys its power from BAM Energy at a competitive rate.

“Our aim is to be able to offer clients the best energy options to suit their needs, regardless of budget restrictions,” added Reid.

“By moving the upfront investment into the client’s general operating costs and agreeing a fixed index for energy consumption, we can offer them better cost certainty.”

Sustainable energy solutions are not just for new buildings. Drawing on experience from managing buildings in the education, healthcare, business and industry sectors, BAM FM helps clients to identify ways they can save energy in their existing estates. Measures to reduce energy use, such as replacing existing lighting with LEDs, using sensors to control lighting or using smart meters to control heating systems, can be costly to install – but BAM Energy takes that cost out of the equation and the client repays the capital investment through the savings they make.

Reid said: “Our team is experienced in identifying opportunities to reduce energy consumption and then designing and installing the right solutions to achieve the best savings. We can finance these on behalf of clients too, opening up new opportunities for us and them.”

BAM updates strategy as UK operations return £20m profit

bamBAM has introduced a new five-year strategy to bring “a more disciplined focus” to its projects after successfully completing its ‘Back in Shape’ restructuring programme.

Financial results for 2015 released this morning showed that BAM’s UK construction and property business returned a £20 million profit last year after suffering a £2.6m loss the year before, due to BAM Nuttall suffering a £20m loss blaming its ‘extremely challenging’ Liverpool 2 container port contract.

UK turnover grew 10 per cent over the year to £1.79bn as the firm benefited from the upturn in the market.

The turnaround makes the UK the most profitable part of the BAM group for the first time and sees the combined Irish and UK operations turning over £2.1bn, more than the Dutch home market.

Overall group pre-tax profit rose 42 per cent to €88.2m on stable sales of €7.4bn as the Back to Shape programme launched back in October 2014 restored group performance, meeting key targets for cost reduction, projects in control, and divestments.

Rob van Wingerden, CEO of Royal BAM Group, said: “I am pleased with the major advances we made in 2015 to successfully implement the Back in Shape programme.

“With our 21,500 people working together, we delivered on demanding targets. Our results for the year show we are turning around our performance, and there is more potential to be unlocked.

“Our updated strategy for 2016-2020 – ‘Building the present, creating the future’ – will further improve the performance of our current project and business portfolio, and will position us for future opportunities. In a fragile macro-economic environment, our objective is to improve profitability and capital efficiency by ‘doing things better’.”

He added: “This means a more disciplined focus on market segments and projects where we can use either scale or expertise as critical success factor. Secondly, we will shape our business portfolio towards ‘doing better things’ by rationalising our propositions and developing new solutions for customers.

“Thirdly, we will invest in digitalisation to be an industry leader in how we build and what we build – ‘doing new things’. Our target is to reach a double digit return on capital employed by 2020.”

Mr van Wingerden said 2016 will be a year of reinforcement with a top priority to implement ‘Building the present, creating the future’.