North-east construction firm Chap is looking to branch out in more ways than one as it strives to put the impact of Covid-19 and current pressures behind it.
The company is eying market opportunities beyond its recent focus, managing director Hugh Craigie told The Press and Journal.
Potential new areas of building activity could include student accommodation, and renovating or building schools, Mr Craigie said.
The firm is also keen to work with universities as part of its ambition to secure new projects in the education sector, he added.
Chap has Tayside in its sights
And Chap – based in Westhill, Aberdeenshire – is also looking to expand its activities geographically, Mr Craigie revealed.
The firm is targeting projects south to Tayside and “everything in between”, he said.
He was speaking as Chap posted results for the year to September 30 2022.
The company achieved a return to the black, generating pre-tax profits of £152,000.
Turnover from continuing operations grew more than 21% to £45.7 million, from £37.6m the year before when Chap suffered losses of £705,000.
Mr Craigie said the business was “on the right trajectory” despite current headwinds.
“It’s looking a lot better than a year ago but we are still not at the place we had hoped to be,” he added.
“We have been quite dependent on social housing but are now trying to diversify again.
“Geographically, we have decided to look south (for new opportunities) rather than north.”
It’s looking a lot better than a year ago but we are still not at the place we had hoped to be.
Hugh Craigie, managing director, Chap
Chap’s past efforts to crack the Inverness market had mixed results, the MD explained.
Two live housing projects at Countesswells, Aberdeen, and Crest of Lochter, Inverurie, are both about two-thirds complete, he said.
On the cost-of-living crisis and what it means for the north-east housing market, Mr Craigie said: “We waited with bated breath to see what the impact would be – but there was none.
“It was as if the public was either not aware or not worried about it.”
But land sales have slowed and there is uncertainty in the market, he added.
Housebuilding sector’s ‘pinch point’
Mr Craigie remains bullish about long-term prospects for house sales and Chap is still looking for new sites to build homes on.
But spiralling costs, including for building materials and labour – and house prices “going in the other direction” are creating a “pinch point” for the sector, the MD said.
Chap employs about 145 people across its construction, civil engineering and Chap Homes business units.
Mr Craigie hailed the group’s year-on-year turnover growth as “early evidence of our strategic plan beginning to pay dividends”.
He added: “A key component of our strategic plans was for the company to strengthen the board and senior management team.
“Accordingly, several prominent appointments have been made over the past 18 months.
“It is great to see the positive impact these new team members are already having on company performance, but also on the enthusiasm levels within the office and on the sites.”
Beefing up the board
Chap recently announced the appointment of industry veterans Derek Shewan and Richard Stott, civils director, to its boardroom team.
Operations director joined in August 2021 and Andy McNair, preconstruction director, came in last February.
Mr Craigie added, “Through the new board and senior management appointments, Chap is now extremely well placed to develop our service offering and geographical reach.
“I am excited about the path we are on and look forward to seeing our plans continue to come to fruition.”
Established in 1976, Chap takes its name from the surname initials of its four founders – Alasdair Craigie (the current MD’s father), Ian Harper, Frank Anderson and Ian Philip.
Mr Craigie Snr retired as chief executive in 2012, passing on the reins of the company to his son and Douglas Thomson as joint managing directors. Mr Thomson left the business in 2019.
Conversation