BUILDING services firm Northern Bear has shrugged off the economic downturn to announce big jumps in its earnings and profits.

The Chester-le-Street group, whose 13 businesses range from roofing to asbestos removal and equipment hire, said pre-tax profits increased by 27% to £2.9m in the year to the end of March. Its earnings rose by 30% to £42m, despite the massive slump in the housebuilding sector.

The group is reaping the rewards from its quick decision to turn its focus away from new housebuilding services before the slump got a grip on the market. It is now concentrating on big public sector construction projects.

Chairman Howard Gold said: “Our strategy of repositioning the businesses away from new house build, which now accounts for only 4% of group turnover was taken at a very early stage in the cycle and has helped insulate us from the severe downturn in that sector.

“To their enormous credit, those businesses with links to the new house build sector continued to contribute to group profitability.”

Northern Bear, which opened Jennings Roofing in Manchester in November, did not make any new acquisitions in the last 12 months but said it would push ahead with its strategy to snap up successful firms to add to the group.

Mr Gold said: “We continue to look for quality, owner-managed businesses, with strong second-tier management to complement our existing 13 operations.”

But shareholders will not receive a dividend on the back of the results. Northern Bear, which has frozen pay across the group to cut costs, said it would reinstate the payment if trading continued to improve.