Keller Group Explained

Keller Group plc
Former Name:Chidworth Limited (19891990)[1]
Type:Public limited company
Industry:Ground engineering
Revenue: £2,966.0 million (2023)[2]
Operating Income: £180.9 million (2023)
Net Income: £89.8 million (2023)
Num Employees:10,000 (2024)[3]
Location:London, England

Keller Group plc is a geotechnical engineering company. It is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index. The company is the world's largest geotechnical specialist contractor.[4]

History

The company was established in the 1950s as the ground engineering division of GKN plc.[5] In 1960, it expanded into a stand-alone piling and ground improvement company and, in 1975, it acquired the German company Johann Keller and took on that name.[5] In 1984, Keller bought Hayward Baker Inc., a US ground engineering business.[6] In 1990, it was the subject of a management buy-out from GKN plc supported by Candover.[6] During May 1994, the company was listed on the London Stock Exchange for the first time;[7] three months later, it was awarded a £7.5 million contract for a German customer; at the time, it was the company's largest single order.[8] In early 1995, Keller Group announced it has recorded £9.4 million in pre-tax profits, a 33 percent rise over the previous year; this was in part attributed to deals made in the North American market.[9] [10]

In 1997, Keller Group's fiscal performance dipped somewhat, which was attributed to external factors such as the strengthening of the Sterling and an economic downturn in Germany.[11] Six months later, profits rose to £13.8 million, which was up 10 percent from the previous year; a large portion of these gains were from its international projects.[12] During 1998, the company elected to expand its British-based concrete repair subsidiary Makers,[13] as well as acquire the Australian foundation specialist Franki for £3.5 million.[14] In August 1999, Keller Group stated that two-thirds of its pre-tax profits were derived from Makers.[15]

Throughout the early 2000s, the American market would be a consistent source of profits for the company.[16] [17] During 2003, Keller Groups underwent restructuring, which included 50 job losses, due to overcapacity and industry-wide changes;[18] profits declined sharply by 46 percent while its subsidiary Makers was marked down by £7 million.[19] [20] However, by the start of 2005, Makers had returned to profitability and Keller Group was once again considering its expansion.[21] [22]

During 2006, Keller Group acquired Anderson Drilling, the creators and owners of the Big Stan drilling rig,[23] along with several British specialist firms,[24] amid stronger than expected fiscal results.[25] In September 2007, the company sold its social housing division for nominal consideration;[26] later that same year, the company acquired the American piling specialist HJ Foundation in exchange for £24.5 million.[27]

During 2008, Keller Group was impacted by the start of the Great Recession and a major downturn in the housing market;[28] in an effort to reduce its dependence upon the US market, it turned towards other markets, such as India and eastern Europe.[29] [30] One year later, the company achieved over £1 billion in turnover for the first time.[31]

In 2011, it was awarded contracts worth £30 million for grouting, structural monitoring and surveying works on London's Crossrail programme.[32] Two years later, Keller Group doubled its profits, which its management was attributed to its international growth.[33]

During 2015, the company's performance dipped due to a downturn in Australia;[34] while lower revenues were recorded for that year, profits actually rose.[35] [36] Nevertheless, in 2018, Keller Group issued a profit warning and dropped out of the FTSE 250 Index.[37] [38]

In January 2023, Keller Group published a profit warning after a "deliberate and sophisticated financial reporting fraud" at Austral Construction.[39] [40] [41] The estimated impact was £6m related to the first half of 2022, and £8m to £10m relating to prior years. Two directors were dismissed as investigations continued,[42] [43] and the company's shares fell 10%.[44] The fraud was described by The Times as "apparently sophisticated".[45] Keller's pre-tax profit for 2022 fell by 17% as a result; it made £56m profit across the year, from a turnover of £2.9bn.[46]

Operations

Keller operates under three divisions and is supported by its group head office:

The company has been involved in laying foundations for complex projects including High Speed 2 in the UK[50] and the Spirit Tower in Australia.[51]

See also

Notes and References

  1. Web site: 13 November 1989 . Keller Group plc overview - Find and update company information - GOV.UK . 17 February 2024 . . en.
  2. Web site: Annual Results 2023 . Keller Group . 5 March 2024.
  3. Web site: Sustainability . Keller Group . 13 February 2024.
  4. Web site: Keller performing well 'despite challenges' . Ground Engineering . 22 November 2021 . 11 March 2023.
  5. News: 11 December 2017 . Share of the week: Keller Group . The Times . 23 May 2019.
  6. Book: Brown, G. . The Independent Director: The Non-Executive Director's Guide to Effective Board Presence . Palgrave Macmillan . 2015 . 978-1349502691.
  7. Web site: Keller Group . 23 May 2019 . London Stock Exchange . 4 August 2019 . https://web.archive.org/web/20190804100105/https://m.londonstockexchange.com/exchange/mobile/stocks/summary.html%3Ftidm%3DKLR . dead .
  8. Web site: 18Aug94 GERMANY: ROCK STEADY KELLER – HANNOVER CONTRACT.The Keller Group has won its largest single contract since its flotation on the stock market in May with a £7.5 million project in Germany . constructionnews.co.uk . 18 August 1994.
  9. Web site: Keller shows profits rise after stock market move . constructionnews.co.uk . 6 April 1995.
  10. Web site: Keller makes big US bucks . constructionnews.co.uk . 21 September 1995.
  11. Web site: German slump takes toll on Keller results . constructionnews.co.uk . 4 September 1997 .
  12. Web site: Overseas work sets up Keller . constructionnews.co.uk . 12 March 1998 .
  13. Web site: Keller to build up Makers base in UK . constructionnews.co.uk . 3 September 1998.
  14. Web site: Keller down under . constructionnews.co.uk . 10 September 1998.
  15. Web site: Keller thanks Makers for growth in pre-tax profits . constructionnews.co.uk . 26 August 1999.
  16. Web site: Barometer set to rise as Keller rides storm . constructionnews.co.uk . 31 August 2000 . BILL . FISHLOCK .
  17. Web site: US proves golden for a bullish Keller . constructionnews.co.uk . 14 March 2002 .
  18. Web site: Keller restructures as overcapacity takes toll . constructionnews.co.uk . 28 August 2003 .
  19. Web site: Profits plummet by 46 per cent at restructured Keller . constructionnews.co.uk . 18 March 2004.
  20. Web site: Makers’ price slashed . constructionnews.co.uk . 4 December 2003.
  21. Web site: Makers shapes up for Keller . constructionnews.co.uk . 7 January 2005.
  22. Web site: Makers recovery ups Keller’s 2004 profits . constructionnews.co.uk . 10 March 2005.
  23. Web site: Meet Big Stan: Giant Drill Is the Rock Star of the Southwest 2011-08-08 ENR Engineering News-Record . 10 September 2022 . www.enr.com . en.
  24. Web site: Keller focused on something special . constructionnews.co.uk . 25 May 2006 . JUSTIN . ATKINSON.
  25. Web site: Claims to boost Keller results . constructionnews.co.uk . 22 June 2006 .
  26. News: Boyd . Olivia . 20 September 2007 . Keller sells social housing business to Mears . .
  27. News: McCulloch . Chloë . 2 October 2007 . Keller Group buys US piling contractor for £24.5m . . 4 August 2019.
  28. Web site: Keller’s housing woes . constructionnews.co.uk . 13 May 2008 . LISA . GLANCY.
  29. Web site: Keller planning a passage to India . constructionnews.co.uk . 5 March 2008 .
  30. Web site: Keller looks beyond US in growth plans . constructionnews.co.uk . 29 July 2008 . DAVID . ROGERS.
  31. Web site: Keller turnover breaks £1bn barrier . building.co.uk . Dan . Stewart . 2 March 2009.
  32. Web site: Keller lands £30m Crossrail contracts . building.co.uk . Iain . Withers . 17 August 2011.
  33. Web site: Overseas growth doubles Keller profit . building.co.uk . Iain . Withers . 4 March 2013.
  34. Web site: Keller profit dips due to Australia slowdown . building.co.uk . Yoosof . Farah . 14 May 2015.
  35. Web site: Profit jumps at Keller . building.co.uk . Tim . Clark . 29 February 2016.
  36. Web site: Keller highlights overseas reach in solid results . building.co.uk . Louise . Dransfield . 1 August 2016.
  37. Web site: Kier and Keller fall out of FTSE250 . building.co.uk . Hamish . Champ . 6 December 2018.
  38. Web site: Keller warns on profit . building.co.uk . Dave . Rogers . 11 October 2018.
  39. News: Fraud a profit drag for Keller . 7 March 2023 . Investors Chronicle . 11 March 2023.
  40. News: Keller shares underpinned despite revelation of fraud at Australian unit . 9 January 2023 . Shares Magazine . 11 March 2023.
  41. News: Keller Posts Strong Overall Performance In H2; Identifies Financial Reporting Fraud In Austral Unit . 9 January 2023 . RTT News . 11 March 2023.
  42. News: Two sacked as top mining contractor uncovers suspected 'sophisticated fraud' . Sydney Morning Herald . 10 January 2023. 7 March 2023.
  43. News: Morby . Aaron . Keller fires two directors after unearthing profit reporting fraud . 9 January 2023 . Construction Enquirer . 9 January 2023.
  44. News: Pitcher . Greg . Keller shares plunge after reporting fraud uncovered . 9 January 2023 . Construction News . 9 January 2023.
  45. News: Keller sacks two and counts the cost of 'apparently sophisticated' fraud . 10 January 2023 . The Times . 12 March 2023.
  46. News: Ing . Will . Keller profit falls after £18m reporting fraud . 8 March 2023 . Construction News . 7 March 2023.
  47. News: 6 January 2020 . Keller rebrands North American businesses . The Construction Index . 6 January 2020.
  48. News: Keller focuses European operation . 19 November 2020 . Ground Engineering . 17 March 2023.
  49. News: 1 July 2019 . Keller to shut loss-making Australian subsidiary . The Construction Index . 1 July 2019.
  50. News: HS2: Bauer-Keller JV wins £95M geotechnical contract . 14 April 2021 . Ground Engineering . 12 March 2023.
  51. News: $1.2b Surfers tower begins its rise . Gold Coast Bulletin . 18 February 2017 . 12 March 2023.

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