‘Pricing pressures’ force down profit at ground engineering specialist

Project delays and “pricing pressures” have squeezed a leading specialist’s profit by more than 60 per cent.

Aarsleff Ground Engineering battled “sustained pricing pressures from both customers and suppliers”, which led to a decrease in its profit and margin, managing director Kevin Hague said in the firm’s latest accounts for the year ending 30 September 2025.

The UK’s ninth-biggest ground engineering contractor – part of billion-pound Danish construction firm Per Aarsleff A/S – made a pre-tax profit of £2.2m in the year, down from £6.1m.

Hague said his business also “experienced a notable increase in project delays during the year”, adding that Aarsleff “operated under challenging trading conditions across the wider market”.

Turnover fell from £79.7m to £75.2m.

But Hague said his firm maintained high utilisation levels for most of its rigs and crews during the year. Although Aarsleff missed its original budgeted targets, it met its revised forecast, he added.

Cash fell from £440 to £261.

Aarsleff carried out a strategic review during 2024/25, and as a result got rid of one loss-making business section.

Hague said the review had led to a short-term reduction in turnover but was “expected to create a platform for future growth as the business repositions itself within these markets”.

The firm also dealt with a shift in customer demand during the year, Hague said, which Aarsleff was able to adapt to “owing to its agile operating model”.

But he added: “The UK operation continues to mitigate concentration risk by maintaining a diversified portfolio across multiple end markets, thereby reducing exposure to sector-specific downturns.”

Aarsleff reported a record forward order book of £36m, which Hague said positions it “strongly” for 2025/26. It also expects further growth in work after developing three new product lines last year.

It retained an average of 244 staff, the same as in the previous year, paying £21m in salaries, up from £19.6m.

Per Aarsleff A/S works across rail, ground engineering, general construction and technical solutions.

Three of its 60 major firms are based in the UK, all of them in the ground engineering space, though Aarsleff is the biggest by turnover.

According to its website, Per Aarsleff A/S has an annual turnover of more than 22.6bn Danish krone (£2.6bn).