More wins for marvellous Mears

14/12/2009 James Crux

Social housing repair-to-domiciliary care star Mears has shrugged off public sector spending cut concerns by clinching at least £200 million worth of new contracts.

Won across its three divisions, the deals are worth an initial £113 million to fully listed Mears, chaired by legendary support services entrepreneur Bob Holt. However, likely extensions should drive the total to ‘in excess of £200 million’.

The bulk of the wins are in Mears’ social housing division, where it has secured work with the borough councils of Crawley and Colchester, the district councils of Canterbury and Thanet, as well as a five-and-a-half-year gas maintenance services deal worth £12 million with Birmingham City Council.

Meanwhile, Mears’ growing care division, benefiting from the local authority trend towards procuring services from fewer, larger market players, has secured business with the local authorities of Newport, Peterborough and Darlington. Elsewhere, its M&E (mechanical and electrical) division has signed contracts valued at £20 million, of which the bulk entails infrastructure and fit out services for the 2012 London Olympics’ Athletes Village.

Since unveiling record full year numbers back in March – showing 2008 turnover up 38 per cent to £420 million – Mears has inked deals ‘with a potential worth in excess of £650 million’ and another record year is shaping up.

Citing its defensive growth prospects, analysts expect pre-tax profits to rise from £20.2 million to £22.4 million this year, on revenues of £471 million, ahead of £26.8 million on £540 million sales by 2010. Up 3p this morning to 273p, the shares currently value Mears at £203 million.