Farrans remains profitable after restructure separates it from sister companies

Farrans Construction remains profitable, according to its first accounts since owner CRH announced it was looking to sell the contractor.

Materials giant CRH said it was examining divesting of Farrans in December 2022 as part of a strategic review.

Farrans is part of Belfast-based Northstone (NI), which formerly included building materials manufacturer Northstone Materials and Cubis Industries, which makes access systems for the utility industry.

Newly released accounts for the year to 31 December 2023 show the business was restructured at the end of May 2023. Northstone Materials and Cubis Industries transferred to other legal entities, with Northstone (NI) now the immediate parent company of only Farrans.

CRH, which also owns Tarmac and Alun Griffiths, said in 2022 it was not looking to sell the other two Northstone entities.

The new trading results combine five months of activity for all three companies, prior to the restructure, and seven months of activity relating only to Farrans.

It does not provide a breakdown for the separate parts, or a like-for-like comparison with its prior financial year.

The turnover provided was £512.5m in 2023, and pre-tax profit stood at £8.2m.

With all three companies’ results covered in the full year of the 2022 results, Northstone (NI)’s revenue was £540m and its pre-tax profit was £7.2m.

The accounts also show that as at 31 December 2023, Northstone (NI) had £156m-worth of assets. However, with the cost of its liabilities deducted, they were only worth £20.7m.

In 2022, the assets minus liabilities of all three companies stood at £151.2m.

In a statement with the accounts, Northstone (NI) chief executive John Wilson said: “Market conditions continued to be very challenging. However, through the management of costs in a competitive environment, the company remained profitable during the period ended 31 December 2023 and together with strong working capital management the financial position at 31 December 2023 remains healthy.”

He added that it was expected that the firm’s 2024 outlook would be similar.

CRH plc declined to comment about the status of its potential sale of Farrans.