Cost-cutting pays off for Scots construction firms

Two major Scottish construction companies have posted profit rises after cutting their costs to combat falls in turnover.

Accounts filed at Companies House showed Fenwick-based Land Engineering grew profits by 9 per cent to 1 million, while Glasgow-based Luddon Construction saw a 40 per cent jump to 418,000.

Turnover at Land Engineering - which has worked on projects including Edinburgh's Our Dynamic Earth - fell by 6 per cent to 43.8m in the year to 31 August due to a major contract ending in the previous year.

Staff numbers fell from 443 to 412, with the associated costs dropping from 10.2m to 9.4m.

At Luddon, revenues for the same period also slipped by 6 per cent, falling to 38.4m. The directors took a collective pay cut from 1.1m to 753,000, with staff costs falling from 12.7m to 11.8m despite the headcount only dipping by 19 to 385.

In the directors' report, chairman Barclay Dougall said: "The recession recovery period seems to be becoming prolong as markets struggle with confidence but there are glimmers of hope, as the quality and quantity of enquiries continue to grow."

Dougall said the firm - which worked on the M8 Seaward Street junction improvements - would continue to diversify and that its "healthy balance sheet" had allowed it to pre-qualify for larger contracts.