O’Rourke Offers £ 58 Million Loan to Firm as Entrepreneur Completes Refinance | New

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Brothers Ray and Des O’Rourke have offered Laing O’Rourke more than £ 58million in loans accumulated over the years under a refinancing deal reached earlier this month.

The couple are the sole shareholders of the country’s largest private entrepreneur which celebrates its twentieth anniversary this month, two decades after the transformational deal that saw their concrete company buy out one of the country’s biggest names, Laing Construction. , for £ 1.

The latest report and the latest accounts from entrepreneur Hinkley Point C show that O’Rourke, the company’s chief executive, and his younger brother Des, his group vice president, have agreed to turn $ 58.3 million £ in equity loans – although an additional £ 13.7million m the two have turned over the business through a home loan has been retained.

President Sir John Parker said O’Rourkes’ decision demonstrated “[their] confidence in the performance and trajectory of the company ”and came on the same day the company negotiated a new £ 35million refinancing facility with sole lender HSBC.

The news emerged as Laing O’Rourke said revenue for the year through March 2021 edged up 2% to £ 2.5bn, although pre-tax profit fell 9% to £ 41.4million.

Laing O’Rourke repaid £ 56million in debt in his last fiscal year and an additional £ 126million since then, with the previous ‘complex’ refinancing split between five different lenders now being traded for a new deal.

CFO Rowan Baker said HSBC’s loan is unsecured, which means the company is not subject to as much interference from lenders as it used to be.

“[The previous refinancing] was a complex structure and because it was secure we needed permission to do more than just run the business, ”she added.

The company said the new deal incentivized or penalized Laing O’Rourke based on his progress on sustainability measures such as reducing carbon intensity, diverting waste from landfills and increasing the number of women in carrying out projects.

The previous refinancing was first done in 2016 with the £ 177million deal, renewed again three years later, struck at the height of its troubles over its deficit PFI hospital scheme in Canada, on which losses rose again last year – by £ 5.5million. to now sit at a cumulative £ 214million, with the company saying last year it was no longer expecting it.

Baker said he was set to draw a line in the sand at the hospital which has been open since 2017 with the second phase of work being completed in April this year by local Montreal contractor Pomerleau.

In August, Laing O’Rourke founder and chief executive Ray O’Rourke said the company plans to go public by 2024, ending more than 40 years of family control.

In its chairman’s statement in the company’s latest report and accounts, Sir John Parker (pictured), a well-respected city veteran, said: ‘We have made significant progress in developing standards for governance that aligns with those required of a listed company.

John Parker

“We have focused on improving our processes and procedures; strengthen our corporate finance controls; and, most importantly, sound administration and compliance. I am happy to report that these are present and continue to be improved.

When asked if a float was inevitable, Rowan Baker, the company’s chief financial officer, who spent nine years at previously listed home builder McCarthy & Stone, said, “We’re ready for anything. options we take. I don’t think it’s inevitable that we will get quoted.

She said investors should be encouraged by the signs of progress in revenue growth and improving margins, adding that the company’s off-site plant was part of its appeal to potential buyers of its shares. .

The company has also been forced to shoulder a £ 14.1million increase in program costs in Scotland due to the impact of the covid-19 pandemic. He did not name the job, but it is believed to be the retail scheme of Edinburgh’s St James district in the middle of the city, with sites in Scotland facing a tighter lockdown than those south of the border .

The company, which carried out 150 job cuts last year, has called for £ 9.5million in paid time off under the government’s coronavirus job retention program, though all staff have been back to work since last summer.

Baker added: “We have used the £ 9.5million as intended and we are not in any position where dividends are contemplated.”

She said the company had returned to normal productivity levels and said it would take the prospect of future restrictions in the wake of increasing cases in the UK. “We have been operating successfully in the covid environment for several months. We think it’s like nothing has happened. The company is targeting between £ 2.5 billion and £ 3 billion in its current fiscal year, she added.

Europe, which includes its operations in the UK, Canada and the Middle East, remains its largest company with revenue of £ 1.6 billion, although this is down from £ 1.8bn he posted last time around. But pre-tax profit rose 27% to £ 70.4million.

Revenue from its Australian business, run by Ray O’Rourke’s son Cathal, rose 39% to £ 890million, while profit before tax edged up £ 700,000 to £ 27.3million of pounds sterling. The firm said it had racked up an additional £ 3.8million in legal bills – bringing total lawyers’ expenses to more than £ 10million – due to a salary dispute with its Japanese partner in part of a huge job at a gas station in northern Australia.

The contractor was building four cryogenic tanks as part of the LNG tank project in Darwin for the main construction partner Kawasaki Heavy Industries. The company lost just over £ 40million on the job which ended in 2017.

The number of employees at the end of the year was 9,866, down from the 11,580 O’Rourke had on his books the year before. The company’s backlog at the end of March stood at £ 7.9bn, while net cash was up over £ 120m to just over £ 276m.

He added that a VAT payable of £ 28.5million, which has been allowed to be deferred by the government due to the pandemic, would be fully refunded by January next year.


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