Green credentials help plumbers ride recession

Jan 30 2009 by Chris Knox, The Journal

A MECHANICAL and electrical plumbing business believes it can continue to grow its £4m turnover as it capitalises on its expertise in the renewable energy sector.

Newcastle-based Gilwood Mast expects to grow its sales to £4.5m this year as it rides out the downturn in the construction market.

The firm, which is part of the Newcastle construction group Dorin and was previously known as Gilwood Engineering Services, specialises in the installation of materials such as solar panels and ground source heat pumps as part of new-build projects.

It believes the popularity of green energy provision and the need to reduce climbing energy bills among cash-strapped consumers will help protect it from the slump.

However, the firm, which is based at Kingston Park, said it had recently been forced to make 10 redundancies to its 40-strong workforce as securing contracts had become more difficult.

Despite this setback, the firm has a strong pipeline of work and believes it is in good financial shape to come out of the recession relatively unscathed.

It is currently fitting solar panels to a 14-unit housing development in Bardon Mill, Hexham, as part of a £280,000 contract. It is also designing renewable energy features for a new conference centre in Newton Aycliffe, County Durham, which is worth £800,000 to the company.

A £900,000 mechanical and electrical project at Southwick Primary School in Sunderland, which includes the installation of ground source heat pumps to provide hot water, is also about to be completed

Managing director David Duffy said: “Like everyone that is involved with the construction sector, we are having to restructure our business in order to remain competitive in what is an extremely challenging environment.

“However, that doesn’t mean that we are struggling, as we have a number of jobs that are keeping our workers busy.

“Every project we do includes an element of sustainable energy, which has made us an ideal choice for public sector contractors who have to meet the Government’s green targets.”

Dorin acquired Gilwood Engineering Services two years ago through its Mast Electrical arm, after the North Shields company clocked up a series of bad debts.

Negotiations for Mast to buy out Gilwood began in spring 2007, but a deal could not be finalised until the following June due to the poor state of its finances.

Company chairman Charles Clark said: “Rules laid out by the Government now mean that most projects must have renewable energy-producing equipment to provide 10% of predicted energy requirements within the scheme, which is good news for companies such as ours.

“Whilst we will continue to provide clients with the traditional mechanical, electrical and plumbing services, this is a new market for us to move into and embrace as we move the business forward.”