RJ McLeod, one of Scotland's biggest independent construction groups, enjoyed an impressive rise in margins last year despite the continuing competitive pressures in the industry.
The Glasgow-based civil engineer and builder achieved an operating profit of £5.93million in the year to 3 November 2013, a 35 per cent rise on the previous year's total of £4.35m, on a turnover only £1.1m higher at £84.4m.
The pre-tax profit was 26 per cent higher at £6.48m, according to the annual accounts just posted at Companies House.
A spokeswoman for RJ McLeod said yesterday that the profit margin of 7.7 per cent, a rise from the previous year's 6.2 per cent, "stands well in the industry".
Bruce Clark, joint managing director, writes in the directors' report: "The civil engineering and building market is still extremely competitive and the directors have acknowledged such conditions when establishing the group's targets for 2014.
However, with the firm foundation of excellent staff and good quality plant and transport linked to structured management and strict financial discipline, the directors expect this year's trading to be positive."
Mr Clark said maintaining up-to-date plant and transport remained a priority, with capital expenditure of £3.1m (down from £3.5m) during the year. The firm's recent and current projects include the £17m by-pass at Dunragit on the A75, the £5m Crianlarich by-pass on the A82, the £17m redevelopment of Scrabster Pier, and an £8m wind farm at Forres.
McLeod's workforce was steady at an average 387 last year, down from 389, but staff costs rose relatively sharply from £17.7m to £19.1m.
The 60-year-old group has no borrowings and saw its cash pile grow by £4.5m to £30m at the year end, with shareholder funds up by £2.5m to £30.8m.
There was a rise from £427,463 to £518,489 in the remuneration of the highest-paid director, thought to be Bruce Clark, who also received a dividend of £529,300, as did director Graeme Clark, while Alexander Osborne received £325,895 and Norman Judd £248,375, all unchanged from 2012.
The firm's statutory report is among the first in Scotland to be covered by new reporting standards from the Financial Reporting Council.
All reports for year ending after September 30 2013, except for the smallest companies, must now replace the "business review" with a "strategic report".
Listed companies will have to provide more information, including their remuneration plans for the year ahead.
McLeod's strategic report, however, is largely a business review of the same length as the 2012 review.