Clugston Group invests in new structure for growth

Clugston, the privately-owned Group, which has expertise in construction, property, logistics and facilities management, has recorded an increase in revenue with sales exceeding £176m, the highest in the Group’s 80-year history, for the 2017-18 financial year. In anticipation of this growth, the board implemented a restructuring programme to ensure the Group remains focused on providing an exceptional level of service to its customers, whilst positioning the businesses for further projected strategic growth.

Having established a market leading position in the Energy from Waste sector, where they have completed numerous successful projects, a new Energy Waste and Renewables (EWR) division has been created to focus on these, and similar, complex civil engineering projects.

The move, which includes several new senior management appointments and promotions, will allow for greater focus on customers’ needs, provide opportunity for innovation and ensure its dedicated teams have project continuity in this complex arena. Currently the EWR division has three major projects on site in Kent, North Wales and Avonmouth, as well as a strong pipeline of multi-million-pound projects across the UK.

This new division is an integral part of the Clugston growth plan and therefore Steve Radcliffe, managing director of Clugston Construction, will focus on developing the new EWR division, supported by Richard Greenwood and Jon Howsam, who have been appointed divisional construction director and commercial director respectively.

Rod Fry, a long-standing experienced Clugston Construction director, will oversee and develop the existing regional and national construction businesses in conjunction with Mike McCarthy as divisional commercial director. Clugston has plans to grow its existing building and civil engineering services in both the private and public sectors, delivering projects through a network of regional offices.

Further investment in people and resources in other areas of the Group include a new leader for the Facilities Management (FM) division with the appointment of Nick Blackstock, who has recently joined the Group. Mr Blackstock brings a wealth of experience in the sector to further develop its existing portfolio of long-term FM contracts for both existing and new customers across a range of sectors.

These appointments come on the back of a set of recently released results, in which Clugston, despite challenging markets, recorded sales of £176m, its highest to date. However, the investment in restructuring the Group to create the platform for future growth, as well as supply chain challenges in some localised areas, and wider macro-economic factors which led to delays to the commencement of a couple of large contracts, contributed to a small pre-tax loss of £0.5m for the financial year 2017-18.

Despite this, the Group maintained a strong balance sheet with accumulated cash balances of £30m at the year-end (January 2018), no bank debt, and a strong forward order book.

The construction division, which in addition to the growth in Energy from Waste, also delivered a new major retail outlet for IKEA in Sheffield, a series of educational developments in Yorkshire and the North East along with industrial projects for its long-term customers in the heavy process sectors throughout the year, achieved a turnover of £158m, the highest in the company’s history.

Clugston’s Distribution division saw turnover increase to £17m, following the earlier appointment of Tim Doggett as distribution director, which has resulted in Clugston securing several long-term contracts with new and existing customers.

Continued investment of £1m in the commercial vehicle fleet enabled the business to grow its bulk food business by over 25% during the financial year, whilst investment in apprenticeship schemes also ensured the business continued to produce highly skilled, factory trained vehicle technicians and fitters, which has enabled Clugston to expand its vehicle maintenance and testing services. The recent introduction of a global freight forwarding offering will also increase flexibility and enable the business to grow.

Meanwhile, Clugston’s Property division produced another very strong set of financial results. With the property market remaining relatively strong in most sectors, the division effected transactions at the 200-acre Redhouse Interchange in Doncaster, where it completed the sale of the remaining 2.8 acres of land and is nearing completion of a 150,000 square foot warehouse which has been sold to a multinational pharmaceutical company.

Commenting on the Group results, Bob Vickers, chief executive, said: “Despite the challenging conditions in several of our key markets, together with investment in the restructuring, we have delivered another credible financial performance. With substantial growth in revenue, as well as accumulated cash balances of £30m and no bank debt, we continue to invest for the future and look to further develop our business by investing in our teams across all our divisions. Finally, whilst the markets in which we operate remain challenging and we believe this will remain so for the foreseeable future, I am sure that the restructuring we have undertaken, particularly within the construction area of our business, will create the focus and drive to enable us to continue to deliver successful projects and satisfy our customers and partners.”

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