WET News

leaders 2017 7 they have sufficient confidence and wherewithal to keep production going through the end of AMP6 into AMP7 whilst those plans are being finalised? We'll just have to wait and see. "Obviously, I'm optimistic because I can see a lot of work but it depends on confidence more than anything else." The arrival of AMP6 brought a lot of change with it – the introduction of a totex culture, for instance. This coincided with the tremendous change that Balfour Beatty as a group has been going through. "It's been challenging," says McGilvray. "These are complicated con- cepts to work through into practical real- ity. Take totex, we all understand our capital. The question is 'do we really understand the operational impact of the solutions we're delivering'? That's pretty hard because even when you're incentiv- ised to become more efficient or save energy or whatever, the world doesn't stand still as we're implementing these solutions. "We could be convinced we're saving a client money operationally as part of a totex solution but if something changes on the plan we're working on or they have a different operational issue that leads to more cost on that side then you end up with a wooden dollars discussion because overall the client might not have saved money even if your element has. "Likewise, on the outcomes, we understand what we're trying to do, we understand much more than we would have done in the past. We've got greater clarity on the outcomes and their impor- tance to the clients." McGilvray says the challenge then is helping the client figure out with what "you can do to implement or effect those outcomes. But again, take the flooding challenges, a lot of things can depend upon the weather. If there's flash flood- ing, you can do all sorts of work on drain- age efforts but if the weather is against you can have a different pat- tern to the measuring again". He says: We're all getting to the nub of asking the right questions. It's really challeng- ing to show the benefits we're bringing to those solutions. The key for us as a group, and the point about the challeng- ing of the past, is one of Bal- four Beatty's challenges which we don't talk about too much was that weren't very good at working across the Leveraging skills intercom- pany skills is providing more opportunities The LeADeRS 2017 THE NUMBERS 2013 2014 2015 % cHaNgE Sales £M 7,488.0 7,264.0 6,955.0 -4 Gross profit £M 435.0 131.0 157.0 20 Operating profit £M -33.0 -334.0 -226.0 n/a Pre-tax profit £M -49.0 -304.0 -199.0 n/a Staff 49,785 39,751 23,316 -41 Net assets £M 1,033.0 1,227.0 826.0 -33 THE RaTIOS 2013 2014 2015 % cHaNgE 5yr aVE. Return on capital % -4.7 -24.8 -24.1 -3 -5.0 Gross margin % 5.8 1.8 2.3 25 6.7 Operating margin % -0.4 -4.6 -3.2 n/a -0.9 Net margin % -0.7 -4.2 -2.9 n/a -0.7 Sales/employee £K 150.4 182.7 298.3 63 198.6 different businesses. "One of the key changes that Leo [Quinn] talks a lot internally and exter- nally now, is about how we leverage the group's capabilities to greater effect for our customers. Probably one of our big- gest opportunities is traditionally we didn't leverage our M&E capability into our water clients, and we're doing a lot of proactive work to see how we can bring these skills and knowledge more proac- tively into the water sector than we've done before. This well help with solutions being sought because there may be some construction but there's also maximising operational processes. "The opportunities are ahead of us."

• Cover