Last updated 20th December 2019
Clugston Group
On 6 December 2019, James Clark and Chris Pole of KPMG LLP were appointed joint administrators of Clugston Group Limited and Clugston Construction Limited in the High Court of Justice, Business and Property Court in Leeds. They were also appointed joint administrators of Clugston Services. Clugston Distribution Services and Clugston Estates are not in Administration and continue to trade as normal.
Clugston is a privately-owned group operating in construction, facilities management, property development and logistics. Founded over 70 years ago by the father of the present chairman John Clugston, the group is based at Scunthorpe in north Lincolnshire, has a turnover of nearly £180 million and employs around 630 people.
It works across the UK and also has offices in Leeds and Hebburn in the North East and Bromsgrove in the West Midlands. Within its construction operation, the group has specialist businesses in building, civil engineering, design & build, facilities management, survey services and specialist ground engineering. Today, the group has a strong presence in energy-from-waste and education and has an expanding business in frameworks and facilities mangement.
Under chief executive Bob Vickers, the group has made a series of new appointments which it says will reinforce growth prospects, including new HR and IT directors and a new strategic lead of its FM business. The group’s construction division has also been restructured.
Despite reporting small losses in 2017/18, in May 2018 the group pointed to a record construction order book and a pipeline of property developments which it expects to deliver sustainable profits.
Financials
To view the financials for Clugston Group Ltd., visit Companies House and use Company ID 00333188.
Clugston Group had a mixed year in the 12 months to January 2018, after losses at its construction and logistics businesses left it nursing a pre-tax loss of £469,000 compared to a profit of £1.04 million previously. However group turnover rose by 49% to £176 million from £118.2 million previously and the group had cash reserves of £30 million at the year end and no bank debt.
Construction
In recent years, Clusgson’s construction arm has prospered by focusing on its core sectors such as energy-from-waste and education whilst fostering long term links with major clients and building up its frameworks business. In 2017/18, Clugston’s construction arm generated a record turnover of £158 million although the business recorded a loss of £204,000 compared with a profit of £235,000 previously, partly due to delays in project starts and shortages of “good quality resources”. However,the division has a healthy forward workload and expects turnover to rise further in the current year.
The firm has a significant workload in education and extra care. Key projects in recent years have included a new IKEA store in Sheffield and a new Jaguar Land Rover showroom for Duckworth JLR in Boston.
In Spring 2018, Clugston Construction won a £25 million contract to construct an extension to the National Distribution Centre in Hull for Arco, a large safety company. The 20,439 sq m extension will double Arco’s current warehousing and logistics capacity, when completed in summer 2019.
Meanwhile, Clugston Construction has started work on the first lake of what will eventually become the £1.2bn Lincolnshire Lakes development, after N Lincs Council secured £2 million of funding for the scheme. The developer envisages six waterside villages and over 6,000 homes by 2028.
Clugston’s workload has been buoyed up by two energy-from-waste schemes at Kemsley in Kent and in Deeside, North Wales. The company is working on building and civils work for a new £180m energy-from-waste facility for Wheelabrator Technologies on the Deeside Industrial Park in Flintshire, North Wales.
Elsewhere, Clugston Construction and CNIM S.A. have a £252 million contract to build an energy recovery facility for Vinidor at Avonmouth. Construction started in summer 2017 on the site which will employ more than 600 people and will be operational by 2020. It is the 11th joint energy scheme where Clugston and industrial contractor CNIM have worked together, including schemes in Leeds, Wilton, Oxfordshire and Shropshire.
The group has also recently returned to the water sector with work at Yorkshire Water’s Knostrop Works through Black and Veatch.
Meanwhile, the group has a place on the North East Univesities Framework and the ESFA Framework for Yorkshire and the North East.Its fit-out business is busy in the health and education sectors.
Meanwhile, Clugston has been winning work in the education sectors. The firm has a place on the North East Universities Major Capital Projects Framework which will deliver up to £750m of building projects over the next six years. The firm is one of six contractors to bid exclusively for all major work from Newcastle, Durham, Northumbria, Sunderland and Teesside universities.
The firm also has a place on the North East Procurement Organisation (NEPO) Civil Engineering Framework worth up to £1.5bn over four years. It will be delivered via the group’s North East office.
Property
Clugston’s property division performed well in 2017/18, according to the group with demand dropping in the retail sector but strengthening in the warehouse market. The divison recorded a profit of £613,000, up from £109,000 previously.
Recent deals have included Redhouse Interchange, where the firm sold its remaining 2.8 acre plot for housing and is nearing completion of a 150,000 sq ft warehouse for a pharmaceutical company. At Turbine Business Park in Sunderland, Clugston has agreed to build and lease a warehouse for a European chemical distribution firm. The division has also won permission for 52 homes on a site in south Leeds and it has acquired a 50,000 sq ft listed mill in Manchester for conversion into 59 flats.
The business operates through Clugston Developments and Clugston Estates and the group originally had around 35 acres of business space land through joint ventures at Turbine Business Park in Sunderland and Redhouse Interchange in Doncaster. Elsewhere, Clugston’s logistics division produced a loss of £204,000.
Glenigan Data
Glenigan Data highlights the growing workload at Clugston. It shows that the group is bidding for main contractor on the £6 University Innovation Centre at the University of Hull where tenders have been returned and work is set to start in Autumn 2018. Glenigan Data also shows that Clugston is bidding on a £2.5 million sports complex in Washington for Sunderland City Council.
Conclusion: Making solid progress
In a tough trading climate, Clugston seems to be making solid progress. Although the group’s most recent profits were down, its order book is in good shape as it has taken advantage of promising markets such as energy-from-waste, refurbishment, education and industrial work. Bolstered by a solid turnover from frameworks and a strong regional base, the group should gain as infrastructure spending picks up and from the continuing underlying shortage of good quality warehousing space.
How to win work with Clugston
Clugston says it recognises that the effective selection and management of works contractors and suppliers is paramount to the success of a project and it puts great effort into the selection process.
Using an appraisal system, it has developed a national and local knowledge of trade contractors and built up a database of companies which will meet its strict standards.
Having developed links with many trade contractors and suppliers, the group encourages them to keep it informed of activities and innovations in materials and processes in their fields. The group invites businesses which would like to become part of its preferred supply chain to contact it through the following:
Carl Whitham, Chief Buyer (Materials and plant suppliers)
Email: carl.whitham@clugston.co.uk
Tel 01724 843491
Subcontractors
Beverley Fraser
Email: beverley.fraser@clugston.co.uk
Tel 01724 843491