– Over €150m in project deferrals due to Covid-19
Sicon Limited, the parent company of the John Sisk & Sons construction and construction-related activities in Ireland, the United Kingdom and Europe, has announced its financial results for the year ended 31 December 2020, with a turnover of €1.503bn and profit before tax of €23.3m
The group maintained high levels of cash throughout the year and has no bank borrowings. Over 98% of the group’s turnover is derived from construction and related activities. The figures also incorporate the results of the Korine Property Partners and Origo Distribution businesses, both of which are wholly-owned subsidiaries.
Increased operating costs
Sicon has reported strong performance for 2020 after allowing for the significant adverse impacts which the Covid-19 pandemic had on the group’s operations throughout 2020 and continuing into the current year. The group experienced a substantial increase in operating costs and took various steps to mitigate these incremental costs. Its construction activities in Ireland were more impacted than other countries due to government-enforced site closures from March 2020 onwards. However, performance and profitability levels rebounded well in the second half of the year, as European economies started to reopen.
Sisk growth in key sectors
John Sisk & Son CEO Steve Bowcott said that 2020 was a year like no other.
“Thanks to all our people, for their commitment and hard work, which kept the business running and for managing through the shutdowns professionally and safely,” Steve Bowcott commented. “Thanks also to our supply chain partners and other stakeholders for their support.
“Growth is continuing across our business in key sectors such as life sciences and data, in both the UK and across Europe as well as delivering much needed social housing through our Sisk Living division. Our new business pipeline remains strong in key target sectors, and while there is some macroeconomic uncertainty, we believe we are well placed and will continue to win work.
“We have also expanded the portfolio of services we offer through Vision Built, our offsite steel frame fabrication business; the ongoing growth of Sisk Living, our social housing business; our partnership with Designer Group in Sensori, our facilities management business, and the new fit-out offering we will launch, which will offer new business opportunity this year and beyond.”
Over €150m in project deferrals due to Covid-19
Commenting on the results, Ger Penny, Chief Financial Officer, Sicon, said: “We are very happy with the results reported in the context of the challenges the Covid-19 pandemic had on all businesses across the world. The group’s activities in 2020 were negatively impacted to varying degrees by the effects of the pandemic, with the year being very much one of two halves, with performance and profitability levels rebounding strongly in the second half of the year as economies reopened. In our construction businesses, the effect of Covid-19 construction site closures and related delays was to defer in excess of €150m of work from 2020 into 2021.”
Projects by country
Projects included the delivery of the iconic new roof at Pearse Train Station in Dublin, handover of the East Quad Building at Grangegorman and great progress on BioCork 2, Bonham Quay in Galway and 60 Dawson Street in Dublin city centre, to name a few.
In Ireland, work was interrupted on all projects with a near-total shutdown of the construction sector for more than two months in the first half of the year with resulting impacts on timelines.
Sisk turned the sod at the start of the year on the new Isle of Man Ferry Terminal in Liverpool, and progress has continued apace there. The iconic Mercian Project, the tallest residential tower in Birmingham, continued on track in 2020 and topped out in early 2021, and a major office project for Banco Santander in Milton Keynes was won and went to site.
The European business has continued to expand primarily in the specialist sectors of data centres and life sciences, where Sisk has extensive experience. During the year, the group worked on projects in Belgium, the Netherlands, Switzerland, Denmark, and Sweden.
Sisk Living, the group’s housing division, delivered 275 vital social housing units in 2020 – this was lower than our budget target due to the industry lockdown.
Sensori Facilities Management, which focuses on delivering fully integrated facility management services to an extensive customer base, was able to quickly adapt its offering to support businesses to make their workplaces Covid-19 safe and, consequently, had another good year.
Vision Built, which is based in Galway and was acquired by the group in mid-2019, has made good progress in 2020 and has worked closely with the Sisk Living team on a number of projects as it looks to leverage its offsite construction capabilities.
Sisk Outlook 2021
The order book in all of the geographies the group operates in is generally very strong. The civil engineering pipeline is very good in both the UK and Ireland, as governments in both countries commit to significant investment programmes as part of their recovery plans from the pandemic.
The group has developed plans to quickly identify and respond to inflationary pressures which it is experiencing in all geographies in which the group operates. A rapid rise in demand for construction products and materials has stretched supply chains, and supplier delivery times have lengthened considerably over the past six months.
Sisk has been successful in frameworks with Vision Built, Sensori and its strategic projects teams for several Irish government bodies, including the OPW, the Department of Education and the Dublin Airport Authority (DAA).
In the UK, the civils team has won a place on several frameworks, including Highways England, York and Humber local authorities and Network Rail. The building team are bidding on the major SCAPE and NHS public sector frameworks.