Amey manages to defy gloom with profits rise

Amey, the construction group floated in June 1994, has shrugged aside the gloom in the industry to report higher first-half profits and the pounds 2m purchase of a tunnelling contractor.

Boosted by a switch to road-maintenance contracts and facilities management, pre-tax profits edged ahead from pounds 1.73m to pounds 1.74m in the six months to June. The interim dividend is being raised from 1.5p to 2.4p.

Neil Ashley, chairman, said: "Opportunities in pure construction will continue to be restricted and it is therefore essential to continue the push into facilities management and maintenance." However, unlike others in the market, he committed the group to maintaining construction capacity.

Mr Ashley said pounds 98m out of the pounds 158m of orders received in the first half related to facilities management and repairs, which means the two areas will represent over 50 per cent of turnover this year. The order book is now 52 per cent higher than last year, at pounds 288m.

The company is also involved, alongside Taylor Woodrow and Sir Robert McAlpine, in the Government's design, build, finance and operate initiatives and is now bidding for two of the second tranche of four. It is also pre- qualifying for the first railway track maintenance business, expected eventually to be worth pounds 1bn to the private sector.

The group is paying pounds 2m for the assets of JF Donelon, the tunnelling arm of the collapsed Donelon Tyson construction group, which had a book value of pounds 6m. Profits are said to have run at around pounds 1m a year for several years.