SISK GROUP, by far the largest construction business in the State, has laid off more than 10 per cent of its staff since the start of the year as a result of the downturn in the building industry, it has emerged.
Group chief Liam Nagle said about 300 workers from a staff of some 2,900 had been made redundant on a phased basis from the business, which is controlled by members of the Sisk family and is one of Ireland's biggest privately-held companies.
Asked if any further job losses were likely, he did not rule that out and said the level of future business activity was difficult to predict at present. However, he said the construction unit had a large order book for 2008 and was well-positioned for 2009.
Nevertheless, Mr Nagle made it clear that revenues and profit margins in the construction sector were under pressure in the declining economy and said difficult conditions in the industry would continue throughout 2009.
Reporting a 7.3 per cent drop to €52.1 million in operating profits for 2007, Mr Nagle said margin pressure was tightening as competition in the commercial and retail construction sectors intensified in light of the reduction in residential construction activity.
Having achieved an 8.3 per cent rise in turnover to €1.81 billion last year, he said group turnover was likely to drop this year to €1.5 billion or €1.6 billion.
When the contribution from Sisk joint ventures was stripped out of the overall figures, turnover rose 6.3 per cent to €1.6 billion.
Profit before tax dropped 21.5 per cent last year to €64.2 million. While an exceptional charge cut pretax profits by €2.3 million in 2007, a company brochure shows there were no exceptional items in 2006 and no proceeds from any disposals of fixed assets that year.
In spite of pressure on the business, Mr Nagle said the group's exposure to residential construction was "relatively low" at 10 per cent.
"The Sisk group has a large order book with a range of construction and infrastructure projects in the pipeline."
The construction business reported a 20 per cent rise in sales in its British unit to £250 million (€314.1 million) last year. It expects to compete for tenders for projects linked to the London Olympic games in 2012.
Sisk's figures for 2007 reflect the combination of the Sisk construction business and contributions from four healthcare units, electrical distribution firm Origo, property business Korine and other subsidiaries.
Although the performance of these units was not individually represented in material circulated yesterday by Sisk, Mr Nagle said he expected an "increasingly significant" profit contribution from divisions outside the construction sector.
The group, which in 2009 will celebrates its 150th anniversary, made three acquisitions in 2007.
These include surgical products firm Tekno, acquired in January, and specialist medical equipment firm Synapse, acquired in July. Mr Nagle declined to reveal Sisk's expenditure on any acquisitions.
