Thompsons of Prudhoe boosts profits by 70%

Nov 27 2008 by Peter McCusker, The Journal

PROFITS at one of the region’s best known building services companies have risen by 70% and with the cash being added to reserves it is now well-placed for a tough road ahead.

Demolition and earthworks contractor Thompsons of Prudhoe saw pre-tax profit rise from £1.3m to £2.2m on the back of a slight increase in turnover to £30.4m.

Chairman John Thompson senior, son of company founder Bill Thompson, says its growth was boosted by the acquisition of Newcastle-based, ready mixed concrete company Tyneside Minimix.

“Each year something has happened to help us grow. It’s not something that we chase, but if it happens, it happens. Last year was a good year for us and this year is going reasonably well.

“There is a general lack of confidence across business, but at the end of the day we are the same people and we are still doing the same job.

“We are not a company that chases turnover. It’s the bottom line that matters. As the old saying goes ‘turnover’s vanity, profit is sanity’. If we have enough to wipe our face at the end of the year we’ll be doing all right.”

Mr Thompson’s son, also named John, is managing director at the 60-year-old firm, which employs 330 people from its base on Princess Way, Prudhoe, Northumberland. The company, which has a fleet of 150 trucks, normally has 30 contracts on the go at any one time. Its impressive CV includes the demolition of Binns, Westgate House and the Central Library, all in Newcastle.

From its demolition and earthworks base the company has diversified into skip hire and quarrying and now owns recycling centres in Gateshead, Benton and Prudhoe.

Mr Thompson snr believes that despite the difficulties in the construction sector the company is well-placed for the future.

“I wouldn’t say things are bubbling, but we do the fundamental things that keep us going. We are an essential service.”

The company’s results for the year end March 2008 have recently been posted at Companies House and they show that profits rose from £1.3m to £2.2m.

These have been transferred to reserves with no dividends being paid to the three directors who also include Mr Thompson’s daughter Helen Hillary. Mr Thompson snr explained that its profits were boosted after it brought forward work to complete infill at a landfill site and he did not expect that figure to be attained this year.

The company does not have any plans for further acquisitions.

He added: “We are in a strong position. We have healthy cash reserves which are there when we want to use them without having to go to the banks. We have enough to keep the wool on our back.”