Last updated 12 April 2023
GMI Construction Group Plc
GMI Construction Group Plc was formed in 1986 and is based in Yorkshire. The group employs more than 200 people and turns over £360 million a year.
Financials
In the 12 months to September 2022, turnover at GMI Construction Group tripled to £360.3 million (2021: £120.7 million) but profitability suffered. Before tax, GMI posted a loss of £2.3 million (2021: £1.0 million profit). At an operating level, GMI lost £3.2 million (2021: £0.8 million profit).
To view the financials for GMI Construction Group Plc, visit Companies House and use Company ID 01988606.
Operations
GMI has its headquarters in Leeds, and has offices in Birmingham, Manchester and Stockton-on-Tees and works across four regions in the North of England and the Midlands
The group works predominantly in the private commercial market and has a strong presence in the industrial, manufacturing, warehouse and logistics sector, where GMI works for development clients such as Alumno Developments, Bridges Fund Management, Greenlane Properties, Integra 61, REIT Investment Management and St James Securities.
Work in the industrial and manufacturing sectors include the £80 million Hillthorn Business Park warehousing development (Project ID: 18441164), the £47 million Harrogate 47 (Project ID: 20366767), the £33.8million DC3 Integra 61 warehouse scheme in Durham (Project ID: 22071321) and a £33 million bottling plant in Derbyshire (Project ID: 19379315). In the office and commercial sector, GMI is working on the £88 million No3 Circle Square scheme in Manchester (Project ID: 19154471).
GMI also working on residential projects for clients such as HBD the student accommodation sector for clients such as Pickard Properties, on development including the £39 million Carlton Hill Student Residence in Leeds (Project ID: 20095302) and the £29 million 411-bed Alumno development, also in Leeds (Project ID: 20236822). GMI is also on the £1 billion Pagabo framework covering the education sector (Project ID: 23018047).
During the 2022 financial year, GMI completed 11 projects and was on site with 32 projects at the year-end.
Glenigan Data
In the 12 months to Q1 2022 calendar year, GMI won main contracts worth a total of £330.5 million (2022: £429.4 million). As a result, the group was ranked in 33rd position in Glenigan’s rankings of the UK’s Top 100 contractors (2022: 30th).
The group only appears among the top 10 contractors in one of the UK’s 12 economic regions. In the North West, GMI is ranked in third place with an annual order book totalling £156.8 million.
Conclusion: Targets met
After a fall of 21% in the 12 months to Q1 2023, GMI’s order book has contracted by 43% over the past two years and the group has fallen out of Glenigan’s rankings of the industry’s Top 20 contractors.
The risk profile has however fallen as GMI has taken on lower value projects. In the 12 months to Q1 2023, the average value of contract awarded to GMI was £19.4 million according to Glenigan’s research (2021: £22.6 million). The group’s annual report puts this figure at £17 million for 2022.
There is a strong focus both regionally and on the building sector. Exposure to civil engineering in the order book has dwindled to just 3% with the balance in building work, while expansion into the North West has proved successful and this region provided 47% of the latest order book by value.
As GMI emerged from the Covid-19 pandemic, the management envisaged the group becoming a £350 million business within three years. The was slow in materialising and turnover in 2021 was 27% below target but revenue has tripled in the latest year, which allowed the group to invest in the business.
More than £3 million was invested in systems and a major recruitment drive. In 2022, the workforce leapt by 41% to an average of 216 employees (2021: 121 employees). As a result, the wage bill more than doubled to £13.3 million (2021: £6.5 million), which tipped the business into the red for the first time since its incorporation.
The group continues to work to a turnover to cash ratio of around 10% as cash at the bank and in hand leapt to £33.7 million (2021: £22.3 million). Net assets strengthened to £12.3 million (2021: £11.9 million) and, despite the recent deficit, the group is debt free.
The prospects of the cost of living crisis pushing the UK into a recession remain a concern, particularly as this may limit investment by clients in manufacturing, but prospects for the wider industrial sector look relatively strong. In 2021, there was a strong bounce-back from the worst of the pandemic and this rise has translated into a strong order book at GMI.
The growth in industrial starts is expected to slow in 2023, while labour shortages and material price rises are also likely to impact on GMI’s margins in the short-term. However, with a large proportion of work negotiated directly or for repeat clients, a strong order book and no bank loans or overdrafts, GMI looks in a good position to accelerate its growth in the post-pandemic period.
Winning Work With GMI Construction Group
GMI wants to establish long-term relationships with its subcontractors and suppliers and to work with companies which share its objectives and business values. Companies working for GMI need to sign up to the ‘GMI Way’, which is made clear through the group’s new communication plans and is a prerequisite to working with GMI. Being socially responsible and sustainable is of the utmost importance, and above all safety.
GMI has partnered with Constructionline as its external pre-qualification provider for baseline validation and expects a Gold Standard performance to go with a Constructionline Gold Standard accreditation before entering into a contract with suppliers.
Information on GMI’s supply chain can be found here. Suppliers interested in working for GMI Construction should get in touch via the Supply Chain Expression of Interest and Onboarding Portal available here.
Key GMI Construction Group procurement contacts include:
Head of responsible business – Claire Preston, tel: 0113-276-0505
Pre-construction technical manager – Kieran Brookes, tel: 0113-276-0505
Senior buyer – Mark Parsons, tel: 0113-276-0505