Keltbray Built Environment business back in profit as quality of earnings strategy lifts company margins

For the year ended 31 October 2024 the business reported profit of £3.2 million, up from a £104,000 loss the year prior, supported by a 17 per cent increase in revenue. 

In addition to improved revenues, the turnaround was driven by a 71 per cent increase in gross profit, reflecting more rigorous project selection and controls and operational management. 

At the year end the business’ balance sheet remained debt free, with cash reserves up by £5.8 million. 

“A key factor was the successful adoption of the Integrated Project Model, where our customers can benefit from a more efficient and controlled delivery of works utilising several of our specialist engineering services in combination,” said Keltbray.  

“This approach has improved performance and client satisfaction through clear, single point accountability.” 

Keltbray said to protect its margins, its investment team now “rigorously” prioritise quality of earnings from projects as opposed to volume, alongside better risk management and commercial criteria. 

Entering the new financial year, Keltbray Built Environment Limited held a secured workload valued at £302 million from blue-chip clients and is forecasting £350 million in revenue this year, with further profit growth expected by the end of the period. 

And last month Metro Bank agreed to offer Keltbray a £30 million working capital loan, comprising a £10 million overdraft and £20 million Revolving Credit Facility (RCF), over three years, to support its operational and strategic priorities. 

“Growth will remain focused on quality of earnings which are underpinned by technically complex, safety-critical, and reliably delivered projects, with particular focus on adjacent regulated markets,” said Keltbray. 

Keltbray diversified into infrastructure services in 2009 with the acquisition of Gamble Rail, followed by Aspire Rail in 2010. Then, in August last year, Keltbray sold its Infrastructure Services Limited (KISL) business to private equity firm EMK Capital.  

The contractor said the divestitures would allow it to focus more keenly on built environment and major civil engineering markets, which remain a “challenging environment” for construction businesses.   

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