Laing O'Rourke explained

Laing O'Rourke
Type:Private limited company
Foundation:1978
Location:Dartford, England
Key People:Ray O'Rourke
(Chairman and CEO)
Cathal O'Rourke (COO)[1]
Industry:Construction, Civil Engineering
Revenue:£3,638.0 million (2022/23)[2]
Operating Income:£(81.5) million (2022/23)
Net Income:£(196.5) million (2022/23)
Num Employees:10,603 (2022/23)
Homepage:www.laingorourke.com

Laing O'Rourke is a multinational construction company headquartered in Dartford, England. It was founded in 1978 by Ray O'Rourke. It is the largest privately owned construction company in the United Kingdom.[3]

History

The company was founded by Ray O'Rourke and his brother Des in 1978.[4] Initially a specialist concrete subcontractor, it was originally based in East London, and was known as R. O'Rourke & Son.[5] In September 2001, R. O'Rourke bought main contractor Laing Construction from John Laing plc for £1. Laing's construction business had been making significant losses, in part due to additional costs on the Cardiff Millennium Stadium project, the National Physical Laboratory, and No 1 Poultry in the City of London.[6] The name of the company was changed to Laing O'Rourke.[7]

In May 2004, the company acquired Crown House Engineering, a mechanical and electrical engineering business, from Carillion.[8] Laing O'Rourke went on to expand its operations in Australia in July 2006, when it acquired Barclay Mowlem, also from Carillion.[9] In 2015, the company became a member of the Housing and Finance Institute.[10]

In December 2015, the chief executive officer of the company, Anna Stewart, stepped down with immediate effect due to ill health. Ray O'Rourke, the company's executive chairman, assumed her role[11] although it was reported that O’Rourke could only spend a limited number of days in the United Kingdom, due to his tax exile status in Jersey.[12]

On 11 January 2016, Laing O'Rourke announced that it had begun the formal sale process of selling its Australian business. This was a result of multiple unsolicited offers and a desire to invest more heavily in the company's operations in the United Kingdom.[13]

In the year to 31 March 2016, the group made a pre tax loss £246m, after being hit by poor performance on its £1.3bn PFI hospital contract (at CHUM) in Montreal, Canada, and on several now completed problem contracts in the United Kingdom. In December 2016 it was rumoured the Australia arm has been taken off the market after Laing O’Rourke failed to find a buyer.[14] The sale process was later discontinued and the Australian business was refinanced in 2017.[15]

In March 2017, the company withdrew 800 of its workers from the Ichthys LNG storage tank project after not receiving payments from Kawasaki for its work for several months: the amount in dispute was $250 million[16] [17] although Kawasaki rejected claims that it owed the disputed money.[18]

In the year to 31 March 2017, the group made a pre tax loss of £67m, largely due to losses of £81m (on revenues of just over £2 billion) at the largest operating division, Laing O'Rourke plc, mainly attributed to its PFI hospital contract at CHUM in Montreal, Canada. The contracting business then employed 8,539 people, more than half of the group's then 15,273 staff.[19]

Publication of the group's results of 2018 was delayed due to "historic turbulence in the construction sector" following the January 2018 collapse of Carillion;[15] [20] in December 2018, the company said increased scrutiny from lenders and accountants was delaying a refinancing move,[21] finally closed in January 2019.[22]

With its operations refinanced in the United Kingdom, Laing O’Rourke published accounts for the year to 31 March 2018, showing the group made a pre tax loss of £46.5m (down from £60.6m in 2017) on turnover down to £2.93bn from £3.17bn.[23]

In March 2023, Ray O'Rourke's son Cathal O'Rourke was appointed the company's chief operating officer.[24] In June 2024, it was announced that Cathal would succeed his father as Laing O'Rourke CEO.[25]

Laing O'Rourke accounts for the year to 31 March 2023 showed a pre-tax loss of £288m on total revenues of £3.4 billion (including £2.18bn turnover from its Europe operations and £1.13bn in Australia).[26] In January 2024, it began company-wide cutbacks as financial analysts warned about the company's financial safety. People on sites across the group were served redundancy notices, including 60 at the Laing O'Rourke Centre of Excellence for Modern Construction (CEMC) at Steetley in Nottinghamshire.[27]

Operations

Laing O'Rourke has operations in two major geographic hubs, Europe and Australia. European operations span Abu Dhabi, Canada, Dubai and the United Kingdom. Australian operations cover Australia, Hong Kong, New Zealand and South East Asia[28] The company operates in building construction, infrastructure construction, investment & development, modular manufacturing, engineering expertise and support services.[29]

Its projects span a range of sectors including, building, transport, power, water & utilities, mining & natural resources and oil & gas.[30]

Major projects

Major projects involving the company have included;

Controversies

Blacklisting

Laing O'Rourke and its acquisition of 2004, Crown House, were revealed as subscribers to the United Kingdom's Consulting Association, exposed in 2009 for operating an illegal construction industry blacklist. Laing O'Rourke was later one of eight businesses involved in the launch in 2014 of the Construction Workers Compensation Scheme,[61] condemned as a "PR stunt" by the GMB union, and described by the Scottish Affairs Select Committee as "an act of bad faith".[62]

In October 2016, Laing O'Rourke and the other construction companies admitted that the blacklist was unlawful and apologised to those damaged by it.[63] In December 2017, Unite announced it had issued High Court proceedings against twelve major contractors, including Laing and Crown House.[64]

Late payment

In April 2019, Laing O'Rourke was suspended from the UK Government's Prompt Payment Code for failing to pay suppliers on time.[65] It was reinstated in November 2019.[66]

Ipswich housing development

In January 2024, at a meeting of the Levelling Up, Housing and Communities Committee, Conservative MP for Ipswich Tom Hunt criticised Laing O'Rourke for doing what he described as a "shocking job" as design-and-build contractor for The Mill, a 327-home high-rise development in central Ipswich, completed in March 2009. Some homes have been deemed unsafe since 2013, when "gale-force winds caused damage and tore cladding from the tower"; cladding on the block was found to be unsafe a year later. Hunt said there were also "deep structural problems" and that over 200 of his constituents had been in limbo for years.[67]

External links

Notes and References

  1. News: Morby . Aaron . Cathal O’Rourke takes new COO role at Laing O’Rourke . 9 March 2023 . Construction Enquirer . 7 March 2023.
  2. Web site: Annual report and consolidated financial statements for the year ending 31 March 2023. LaingORourke.com . Laing O'Rourke . 25 January 2024.
  3. Web site: Top 100 Construction Companies 2011 . 2023-07-23 . www.theconstructionindex.co.uk . Construction Company Directory.
  4. News: Ing . Will . Laing O’Rourke co-founder dies aged 75 . 19 July 2024 . Construction News . 18 July 2024.
  5. http://www.laingorourke.com/aboutus/Our_Journey/Pages/Home.aspx Laing O'Rourke: History
  6. News: Rogers . Dave . Sir Martin Laing dies aged 81 . 5 January 2024 . Building . 5 January 2024.
  7. News: Laing shares half in value. BBC. 27 September 2001. 30 December 2018.
  8. Web site: Laing O'Rourke pays £17m for Crown House. 20 May 2004. Construction News. 30 December 2018.
  9. Web site: Carillion sells Barclay Mowlem to Laing O'Rourke Australia for £30m. Contract Journal. 3 July 2006. 30 December 2018.
  10. Web site: PIF Proposal: Housing & Finance Institute. City of London Corporation. 30 October 2017.
  11. Web site: Laing O'Rourke CEO Anna Stewart resigns - Appointments . Construction Week Online . 2018-12-30.
  12. Web site: Ray O’Rourke can only spend part of the year in UK . Construction Enquirer . 2018-12-30.
  13. Web site: Laing O'Rourke to sell Australian business. 11 January 2016. Construction News. 30 December 2018.
  14. Web site: Laing O’Rourke suffers massive £246m loss . Construction Enquirer . 2018-12-30.
  15. News: Rogers . Dave . Laing O’Rourke blames 'Carillion factor' as it looks to calm jitters over late-running accounts… . 29 October 2018 . Building . 29 October 2018.
  16. Web site: Workers caught up in $250 million contract dispute between Laing O’Rourke and Kawasaki Heavy Industries. 15 March 2017. NT News. 30 December 2018.
  17. Web site: Laing O’Rourke takes 800 workers off Ichthys LNG project . LNG World News . 2017-03-15 . 2018-12-30.
  18. Web site: Inpex: Kawasaki rejects claims it owes money over LNG project dispute as workers left high and dry - ABC News (Australian Broadcasting Corporation) . Abc.net.au . 2017-03-17 . 2018-12-30.
  19. News: Rogers . Dave . Laing O'Rourke plc stays in red . 29 October 2018 . Building . 13 March 2018.
  20. Web site: Laing O'Rouke refinancing delays results. Construction News. 29 October 2018. 30 December 2018.
  21. News: Clarence-Smith . Louisa . Construction giant Laing O’Rourke faces questions over crucial funding . 17 December 2018 . . 17 December 2018.
  22. News: Morby . Aaron . Laing O’Rourke seals refinancing deal with banks . 8 January 2019 . Construction Enquirer . 8 January 2019.
  23. Web site: Annual report and consolidated financial statements for the year ending 31 March 2018 . LaingORourke.com . Laing O'Rourke . 19 February 2019 . 29 September 2020 . https://web.archive.org/web/20200929101204/https://www.laingorourke.com/~/media/lor/files/laing-orourke-annual-report-fy18.pdf?la=en . dead .
  24. News: Morby . Aaron . Cathal O’Rourke takes new COO role at Laing O’Rourke . 9 March 2023 . Construction Enquirer . 7 March 2023.
  25. News: Marrs . Colin . 24 June 2024 . Ray O’Rourke to hand chief executive reins to son Cathal . 24 June 2024 . Construction News.
  26. News: Pre-tax loss of £288.1m for Laing O’Rourke . 26 January 2024 . PBC Today . 30 November 2023.
  27. News: Another redundancy round sounds alarm at Laing O’Rourke . 26 January 2024 . The Construction Index . 25 January 2024.
  28. Web site: Where We Work . Laing O’Rourke . 16 September 2014.
  29. Web site: What We Do . Laing O’Rourke . 16 September 2014.
  30. Web site: Our Sectors. Laing O’Rourke. 16 September 2014. https://web.archive.org/web/20140927165421/http://www.laingorourke.com/our-work/our-sectors.aspx. 27 September 2014. dead.
  31. http://business.timesonline.co.uk/tol/business/industry_sectors/construction_and_property/article673422.ece Ascot wins its race to redevelop the course
  32. http://news.bbc.co.uk/1/hi/uk/7294618.stm Queen opens new Heathrow terminal
  33. http://www.ancr.com.au/Darwin_Convention_Centre.pdf Darwin Convention Centre
  34. http://www.iaq.com.au/images/PDF/Yearbook/2009/Part%205.pdf IAQ Handbook
  35. http://www.constructionweekonline.com/article-8631-uk-giant-laing-orourke-denies-me-withdrawal/ UK giant Laing O'Rourke denies ME withdrawal
  36. Web site: Equion signs major Newcastle hospital contract worth £300m. John Laing plc. 15 April 2018. 10 May 2021. https://web.archive.org/web/20210510041131/https://www.laing.com/news/111/27/Equion-signs-major-Newscastle-hosptital-contract-worth-300m.html. dead.
  37. http://www.building.co.uk/comment/what-next-for-laing-orourke?-britains-most-secretive-contractor/5008596.article What next for Laing O'Rourke? Britain's most secretive contractor
  38. Web site: One Hyde Park, Knightsbridge Flats. e-architect. 22 March 2015.
  39. News: 'Milestone move' for PFI hospital. BBC. 19 December 2006. 13 April 2018.
  40. Web site: New ward approved for 'shoddily built' Middlesbrough hospital. BBC. 8 May 2008. 4 May 2018.
  41. Web site: The Contract/Project Agreement (PA). University Hospital of North Staffordshire NHS Trust. 4 May 2018. 5 May 2018. https://web.archive.org/web/20180505134803/http://www.uhnm.nhs.uk/aboutus/Documents/New%20Hospital%20Project%20Partners/The%20Contract%2023.10.08.pdf. dead.
  42. http://www.nce.co.uk/news/transport/laing-orourke-begins-london-gateway-dredging/5215494.article Laing O’Rourke begins London Gateway dredging
  43. http://www.constructionenquirer.com/2011/08/02/orourke-to-start-cheesegrater-next-month/ O’Rourke to start Cheesegrater next month
  44. https://www.constructionnews.co.uk/buildings/contracts/laing-orourke-ferrovial-sign-800m-terminal-2-deal-15-03-2010/ Laing O'Rourke/Ferrovial sign £800m Terminal 2 deal
  45. News: The Pacemaker: Inside Laing O'Rourke's fastest ever hospital. 11 December 2014. Construction News. 26 April 2018.
  46. http://www.constructionenquirer.com/2011/03/02/orourke-set-for-prized-350m-superlab-contract/ O’Rourke wins prized £350m superlab contract
  47. http://www.constructionenquirer.com/2011/02/25/laing-orourke-signs-1-27bn-deal-for-canadian-hospital/ O’Rourke signs £1.27bn deal for Canadian hospital
  48. Web site: Laing O’Rourke and Ryder appointed to build £200m Dumfries Royal Infirmary. 3 September 2014. Urban Realm. 12 September 2014.
  49. News: TfL awards £300M Bond Street contract to Costain/Laing O'Rourke JV. 4 August 2010. New Civil Engineer. 28 March 2015.
  50. http://www.arabianbusiness.com/aldar-al-raha-beach-sees-first-contract-200410.html Aldar Al Raha Beach sees first contract
  51. Web site: Glan Clwyd Hospital Redevelopment. Premier Construction News. 30 April 2013. 21 November 2014.
  52. Web site: Next step for Northern Line Extension. 21 August 2014. Wandsworth Council. 1 May 2017.
  53. News: Garner-Purkis . Zak . Laing O’Rourke confirmed on Carillion's Royal Liverpool Hospital . 26 October 2018 . Construction News . 26 October 2018.
  54. Web site: Royal Liverpool Hospital's A&E department to move to new site. Liam. Thorp. 18 October 2022. Liverpool Echo.
  55. https://www.constructionnews.co.uk/archive/laing-orourke-bouygues-lands-2bn-hinkley-nuclear-prize-19-06-2012/ Laing O'Rourke/Bouygues lands £2bn Hinkley nuclear prize
  56. News: O’Rourke starts work on £420m Brighton hospital. 28 September 2014. Construction Enquirer. 3 September 2014.
  57. Web site: Laing O'Rourke wins £700m Brent Cross expansion. 23 October 2017. Construction News. 26 November 2017.
  58. Web site: Rogers . Dave . Laing O’Rourke wins £250m Whiteleys job | News . Building . 2019-10-16.
  59. Web site: Everton appoint Laing O'Rourke to build new £500m stadium. 19 February 2020. BBC. 20 February 2020.
  60. Web site: Laing O’Rourke wins HS2 Interchange Station contract. 11 July 2022. HS2. 11 July 2022.
  61. News: Construction blacklist compensation scheme opens. 7 September 2015. BBC News: Business. BBC. 4 July 2014.
  62. Web site: Scottish Affairs - Seventh Report Blacklisting in Employment: Final Report. www.parliament.uk. Scottish Affairs Select Committee. 7 September 2015.
  63. Web site: Blacklisted workers win compensation from big construction firms. The Guardian. 29 April 2016. 4 March 2018.
  64. News: Prior. Grant. Unite launches new round of blacklisting legal action. 4 December 2017. Construction Enquirer. 4 December 2017.
  65. News: Morby . Aaron . Industry giants shamed over late payment . 29 April 2019 . Construction Enquirer . 29 April 2019.
  66. News: Morby . Aaron . Laing O’Rourke reinstated to prompt payment code . 22 November 2019 . Construction Enquirer . 21 November 2019.
  67. News: Ing . Will . Tory MP slams Laing O’Rourke over defects at Ipswich block . 18 January 2024 . Construction News . 18 January 2024.

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