Skanska UK has today reported a strong performance in the first half of 2014 – and on Wednesday the Group announced that the award of a Welsh Water AMP6 alliance contract to a Skanska-Hyder partnership could run for up to 10 years with an estimated total of £250 million over the period.

Skanska UK’s construction business recorded operating profit of £19.9 million in the first half of 2014 and revenue of £651.4 million, equating to an operating margin of 3.1 per cent. In the first six months of 2014, £858.8 million of orders were booked by Skanska.

Skanska UK President and CEO Mike Putnam commented:

“Our order bookings equate to a book to build ratio of 132 per cent. Any figure greater than 100 per cent is good as it means we are taking in more bookings than revenue. We are in the process of recruiting an additional 1,500 people to fill new roles as a result of this success.”

Skanska announced back in April that it was creating 1,500 new jobs in the UK over the next two to three years to deliver the work it has already secured.

Overall Putnam is optimistic:

“We’ve had a good first half of 2014. We have strong order bookings and a very healthy pipeline of projects. I am confident that 2014 will be another strong, stable year for Skanska UK.”

With 5,200 employees, Skanska UK is one of the country’s top Tier 1 contractors – with revenue of £1.216 billion and an operating profit of £41.9 million in 2013 – and a key player in the UK water sector.

The Skanska-Hyder team has been named as a capital delivery partner for Welsh Water, with a contract which could run for up to 10 years. Valued at an estimated £25 million a year to the partnership, it will run for an initial five years with a review at the end of the AMP6 (Asset Management Plan) period, which could lead to a five-year extension.

Work will start with an early contractor involvement (ECI) phase, involving all delivery partners, in preparation for the start of AMP6 delivery from April 2015.