By Kristy Dorsey
Perth-based mini-conglomerate I&H Brown has reported a surge in profits as it rebounded from last year’s first lockdown to a full order book that allowed it to make up some of the revenue lost when “almost no work was carried out”.
Restrictions to prevent the spread of Covid led to significant losses between March and June of last year and pushed revenues down to £49 million for the 12 months to the end of August, compared to £60m a year earlier. However, profits surged from £200,000 to £1.9m.
Scott Brown, managing director of the family-owned business, said the increase in profitability was driven by improved margins and the company’s exit from some loss-making contracts. Those contracts were linked to its English offices in Exeter and Warrington, with the Exeter office now closed.
Employing about 200 people, I&H Brown’s dominant plant hire, civil engineering and waste disposal operations are accompanied by smaller property development, farming and estate management divisions. Commenting on trading in the current financial year, Mr Brown said profits will “hopefully” double as all divisions continue to make progress.
READ MORE: Perth civils specialist predicts higher profitability despite lockdown losses
“We anticipate an upturn in profit across our business on an increased turnover,” he said. “Our workload has been excellent comprising a diverse range of projects being carried out for highly-respected clients including Winchburgh Developments where we recently completed a new marina off the Union Canal.
“Other notable projects include a major sub-station for the Neart ne Gaoithe (NNG) offshore windfarm for GE, Westcraigs infrastructure for Lloyds Bank and Blindwells New Town for Hargreaves Land.”
Workload for the next six months “has never been better” at £34m, though the company said it is experiencing cost increases for raw materials along with challenges in the supply chain.
The development division includes projects at East Kingsway in Dundee, and a large site in North Dunfermline where I&H Brown has sold land to Bellway Homes.
A result from the company’s planning appeal at East Kingsway, where proposals for a Tim Horton drive through were refused, is expected “imminently”. Further land sales are being negotiated in North Dunfermline.
“North Dunfermline is a large strategic expansion which is largely in the control of I&H Brown,” Mr Brown said. “Discussions are ongoing with Fife Council to agree the funding of a new primary school to allow further development parcels, including affordable housing, to be completed.
READ MORE: Obituary: James Hardie Brown – entrepreneur and bon viveur who adored plant machinery
“The development division continues to progress towards site starts on several other strategic landholdings which either have planning consent or which are allocated for development. Strong housebuilder interest continues to be shown across a range of sites.”
The company continues to support NHS Charities Together with a gift of earnings from one of its excavators, the “Lockdown Ranger”, which was named by a local school pupil from Winchburgh. It has been working for about a year at the site, and to date has generated about £12,000 in donations from I&H Brown, with that sum matched by Winchburgh Developments.
In March, the company announced the death of Mr Brown’s father Hardie Brown, one of the founders of the business.
Hardie Brown and his brother Ian left their native Fife in the 1950s and purchased Innergask Farm in in Perthshire. Part of the land was covered by a concrete aerodrome and, towards the end of the decade, the brothers decided to get rid of it by using a Traxcavator, a combined tractor and excavator.
The machine aroused interest and the Browns began renting it out, which led to the formation of the plant hire business in 1964. From there the business went on to diversify into construction, mining, housebuilding, farming and land remediation.
Shareholder funds at the end of August stood at £49m, up from £47m a year earlier. The company said it continues to invest in its plant fleet, as well as staff training.
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