One sentence summary – VolkerWessels UK reported a 39% increase in pre-tax profit and a 17% growth in revenue in 2022, with all sectors of the company experiencing growth, driven in part by rail projects such as HS2 and East West Rail, although the company faced a legal dispute with HM Revenue & Customs resulting in a significant tax payment.
At a glance
- VolkerWessels UK reported a 39% increase in pre-tax profit to £37.7m in 2022.
- The company experienced a 17% growth in revenue, reaching £1,349m in the same period.
- The profit margin improved from 2.4% in 2021 to 2.8% in 2022.
- VolkerWessels UK had a secured order book worth £1,732m by the end of the year.
- All sectors of the company experienced growth during this period.
The details
VolkerWessels UK reported a 39% increase in pre-tax profit to £37.7m in 2022.
The company also experienced a 17% growth in revenue, reaching £1,349m in the same period.
The profit margin improved from 2.4% in 2021 to 2.8% in 2022.
By the end of the year, VolkerWessels UK had a secured order book worth £1,732m.
All sectors of the company experienced growth during this period.
The rail sector’s growth was driven by projects such as HS2, Barking Riverside overland extension, and East West Rail.
VolkerFitzpatrick, a subsidiary of VolkerWessels, is involved in a joint venture for infrastructure work at RAF Lakenheath.
The company has secured, extended, and renewed long-term contracts, providing stability and visibility in the order book.
However, VolkerWessels faced a legal dispute with HM Revenue & Customs (HMRC) that resulted in a payment of £14m in tax.
The case involved the contractor’s attempt to set off losses for its former Volker Stevin Construction Europe arm, which had incurred losses of around £38m during 2007-2009.
VolkerWessels surrendered the majority of these losses to other members of its group to pay less tax.
After an investigation, HMRC determined that the contractor owed £10.2m in tax.
VolkerWessels appealed the decision to the Court of Appeal but lost the case in March 2023.
In its financial year ending 31 December 2022, VolkerWessels included the £10.2m tax bill and £4.1m in interest and penalties.
The company’s pre-tax profit for the period was £37.7m, up from £27.1m the previous year.
However, after taxation, the profit dropped to £15.9m, £8m lower than in 2021.
Turnover increased to £1.35bn in 2022, up from £1.15bn.
The growth in turnover was driven by commercial, industrial, and educational work, with revenues from these sectors totaling £337m, up from £170m in the prior year.
VolkerFitzpatrick, a subsidiary of VolkerWessels, experienced lower activity levels in the commercial office market but secured significant work in the life sciences sector.
The contractor began work on the £174m Eastbrook Studios project in Dagenham, East London.
Rail projects, including HS2, East-West Rail, the London Overground extension in Barking, and the new University Station in Birmingham, generated £494m of the group’s revenue.
Rail was the largest sector for VolkerWessels.
Overall, VolkerWessels UK demonstrated strong financial performance with increased pre-tax profit and revenue growth.
However, the legal dispute with HMRC resulted in a significant tax payment and impacted the company’s after-tax profitability.
The growth in turnover was primarily driven by commercial, industrial, and educational projects, while rail projects played a substantial role in revenue generation.
VolkerWessels’ financial strategy focuses on profitability, cash flow, and managing overheads and capital investment appropriately.
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| theconstructionindex.co.uk |
|---|
| – Pre-tax profit at VolkerWessels UK increased by 39% to £37.7m in 2022. – |
| Revenue also saw a growth of 17% to £1,349m in the same period. – |
| The profit margin improved from 2.4% in 2021 to 2.8% in 2022. – |
| The secured order book was worth £1,732m at the end of the year. – All parts of the company experienced growth. – Growth in the rail sector was driven by projects such as HS2, Barking Riverside overland extension, and East West Rail. – VolkerFitzpatrick is involved in a joint venture for infrastructure work at RAF Lakenheath. – |
| The company has a strong reputation and has secured, extended, and renewed long-term contracts. |
| – These contracts provide stability and visibility in the order book. |
| constructionnews.co.uk |
|---|
| – VolkerWessels lost a legal dispute with HM Revenue & Customs (HMRC) and had to pay £14m in tax. – |
| The case involved the contractor’s attempt to set off losses for its former Volker Stevin Construction Europe arm. – Volker Stevin Construction Europe incurred losses of around £38m during 2007-9. – VolkerWessels surrendered the majority of these losses to other members of its group to pay less tax. – HMRC conducted an investigation and determined that the contractor owed £10.2m in tax. – VolkerWessels appealed the decision to the Court of Appeal but lost the case in March 2023. – |
| The contractor included the £10.2m tax bill and £4.1m in interest and penalties in its financial year ending 31 December 2022. – Pre-tax profit for VolkerWessels was £37.7m in the period, up from £27.1m the previous year. |
| – After taxation, the profit dropped to £15.9m, £8m lower than in 2021. – Turnover for the contractor increased to £1.35bn in 2022, up from £1.15bn. – |
| The growth in turnover was driven by commercial, industrial, and educational work. – Revenues from these sectors totaled £337m, up from £170m in the prior year. – VolkerFitzpatrick, a subsidiary of VolkerWessels, experienced lower activity levels in the commercial office market but secured significant work in the life sciences sector. – |
| The contractor also began work on the £174m Eastbrook Studios project in Dagenham, East London. |
| – Rail was the largest sector for the group, generating £494m of its revenue. |
| – Rail projects included HS2, East-West Rail, the London Overground extension in Barking, and the new University Station in Birmingham. – VolkerWessels’ financial strategy focuses on profitability, cash flow, and managing overheads and capital investment appropriately. |
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