Water & Wastewater Treatment

LEADERS 2019 5 Galliford Try Infrastructure proved to be the most productive company in our database, with a ratio of £507.2k in revenue per employee. The Galliford Try group is benefiting from the introduction of its Strategy to 2021, which the company said is "making us simpler, leaner, more profitable and more sustainable". Kier Group, despite its well-publicised recent troubles, emerged as the leader in both operating profit and gross profit, and chairman Philip Cox said in September that the Future Proofing Kier efficiency and streamlining programme "positions the group well for an improvement in operating margins and higher cash generation, culminating in a net cash position for FY21". J Murphy & Sons can celebrate retaining its place at the top of the gross margin charts with 47.1 per cent, while Lewis Civil Engineering has the highest return on capital percentage at 44.64, despite seeing a 15 per cent drop from its 2015-16 accounts. Future business Operating models look set for a period of evolution, creating different opportunities for the supply chain. To bring about greater efficiency in AMP7, some water companies have either established their own, in-house design teams or appointed long-term design partners with a view to utilising a wider range of contractors for pure delivery. The coming years may see a significant growth in the idea of the intelligent The Leaders 2019 exclusive index illustrates contractors' total combined sales, net assets and productivity patterns for a five-year period from 2013 TOP 10S Sales £m Balfour Beatty 6916 Kier Group 4239.6 Morgan Sindall 2792.7 Amey 2198.190 Mace 1971.748 Skanska UK 1802.714 Costain 1684 Laing O'Rourke 1542.51 Interserve Construction 1110.481 Operating profit £m Kier Group 134.4 Balfour Beatty 89 Morgan Sindall 67.4 Atkins 64.8 Costain 44.3 Mace 26.519 Morrison Utility Services 25.47 AECOM 16.861 Skanska UK 14.603 Return on capital % Lewis Civil Engineering 44.644 Mace 36.699 Stonbury 30.204 Lanes 26.357 Barhale 23.823 Black & Veatch 22.528 Stantec 22.354 Trant Engineering 21.116 Morgan Sindall 20.499 Atkins 20.308 Gross margin % J Murphy & Sons 47.119 Atkins 38.851 Stantec 38.764 Mott MacDonald 36.408 George Leslie 35.436 Stonbury 31.417 AECOM 30.010 nmcn 26.942 Lanes Group 25.167 Veolia 16.956 Sales/employee £k Galliford Try Infrastructure 507.185 Interserve Construction 484.503 Mace 416.772 Costain 408.936 Volkerstevin 397.25 MWH Treatment 385.403 Balfour Beatty 330.277 Skanska UK 314.007 Black & Veatch 273.238 Veolia 253.234 Bam Nuttall 237.013 client, with water companies potentially seeking to increase their direct dealings with what might traditionally be regarded as the second and third tiers of the supply chain to maximise value and take greater control over results. As one water company source says: "We're giving ourselves more options about how we might choose to deliver." There has also been plenty of interest in the Institution of Civil Engineers' Project 13, which has been developed as a response to the infrastructure sector's "broken" operating model. Seeking a solution to the issues of projects regularly being delivered "over budget, past deadline and below par", the model promotes 'enterprises' that typically involve longer-term relationships between owners, investors, integrators, advisors and suppliers working as one team to optimise value. Anglian Water is one of a handful of early Project 13 adopters through its capital delivery alliances, which were set up on 15-year contracts featuring five-year review periods, and the success of those agreements may encourage others to follow suit. Ofwat's direct procurement for customers initiative, meanwhile, saw little take-up for PR19 but could create some significant opportunities down the line. Ultimately, to respond to water companies' needs while protecting margins, contractors will need to demonstrate that they are moving with the times. INDEXED TO 100 IN 2013: FIVE YEAR INDUSTRY TREND THE LEADERS: COMBINED FIGURES 130 120 110 100 90 Sales Net assets Sales/employee THE NUMBERS 2013 2014 2015 2016 2017 Sales £m 26,424.1 27,752.3 29,433.7 31,113.8 32,349.9 Net assets £m 4650.77 4984.02 4702.30 4385.61 4950.91 Sales/employee £k 183.7 195.5 197.8 214.1 231.3 2 0 13 2 0 1 4 2 0 15 2 0 16 2 0 17

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