Last updated 29 March 2023
Multiplex Europe
Formerly known as Brookfield Multiplex Europe, the company now trading as Multiplex Construction Europe is the UK operation of Brookfield Asset Management. The UK operation works on a handful of major projects, often in conjunction with Brookfield’s own development arm, or on major healthcare schemes and employs around 650 people and turns over nearly £600 million a year.
Financials
In the 2022 calendar year, turnover at Multiplex Construction Europe fell back to £561.9 million (2021: £793.1 million) but profitability soared. Net profits before tax leapt to £11.1 million (2021: £2.6 million).
To view the financials for Multiplex Construction Europe Ltd, visit Companies House and use Company ID 03808946.
Operations
The original Multiplex business that Multiplex Europe grew out of made its name through the rebuilding of Wembley Stadium in north London for the Football Association. The business was subsequently taken over by Multiplex and continued to specialise in a handful of major projects, albeit ones with a lower risk profile than Wembley.
Multiplex took on projects such as the £670 million New South Glasgow Hospital project (Project ID: 05079136) but more recently the focus on London has grown as Multiplex Europe seeks to make the most of its expertise building out tall towers, hospitals and high-end residential developments.
This has seen the group work for major private commercial developers, such as Delancey Estates, Hyatt Group and Native Land and high profile schemes, such as the £600 million 22 Bishopsgate development for AXA Real Estate (Project ID: 01100614) and the £400 million 30 Grosvenor Square hotel scheme (Project ID: 16118198) for joint clients, Grosvenor and Qatari Diar.
Multiplex Europe continues to work in Scotland, particularly for the University of Glasgow on a range of schemes including the £55 million Adam Smith Business School & PGT Hub (Project ID: 17079065).
In 2022, Multiplex Europe won a £120 million deal to build the 76 Upper Ground office and retail scheme on London’s South Bank for joint clients, Stanhope and Wolfe Commercial (Project ID: 18425204).
In 2022, Multiplex Europe completed four projects with a total value of £700 million and at the year-end estimated the value of its order book to be £2.4 billion (2020: £2.7 billion). This included three multi-use projects worth £1.8 billion, five commercial schemes worth a total of £450 million and several higher education wins worth a combined figure of £150 million.
Glenigan Data
In the 2022 calendar year, Multiplex Europe had an order book of construction contracts each valued at £250,000 or more that was worth a total of £120.0 million (2021: £462.6 million).
Conclusion: Getting smaller?
Like most major contractors, the Covid-19 pandemic took a toll on Multiplex and while revenue rebounded strongly in 2021 it remained 25% down on pre-pandemic levels and then fell back in 2022.
The profit margin at an EBITDA level did however more than double to 2.9% (2021: 1.2%) but most other indicators fell ranging from the order book at the year-end to the construction backlog of future revenue on secured contracts, which fell to £1.1 billion (2021: £1.4 billion).
This is primarily because the group remains disciplined about what work is taken on, and that strategy, combined with a policy of working on a handful of major projects
Multiplex is taking on some projects below the £100 million level, such as the £60 million 65 Davies Street office scheme in London’s Westminster (Project ID: 13032040), but the focus remains on larger projects. The average contract won by Multiplex in 2022 was valued by Glenigan at £120.0 million (2021: £232.3 million) and the group again did not even feature in Glenigan’s ranking of the UK’s top 100 contractors by orders as the criteria of winning three or more contracts necessary for inclusion was not met. In 2020, Multiplex had been ranked 23rd.
This policy of taking on a handful of big projects can be risky as Multiplex found out when the company first moved to the UK and took on the rebuilding of Wembley Stadium in the late 1990s. Despite these problems, this remains the management’s strategy and came back to haunt Multiplex again in 2019, when four projects that the management described as ‘challenged’ cost the group £38.6 million.
In response, the cost base was addressed and the workforce cut by 8% in 2019 and another 10% in 2021. In 2022, the average number of employees was reduced by another 10% to 652 people (2021: 725 people) and the wage bill was reduced by 7% to £63.0 million (2021: £67.5 million).
Elsewhere, cash and cash equivalents did improve considerably in 2022 to £67.1 million (2021: £15.3 million) but with future revenue from secured contracts and the order book both down, turnover could well decline again in the near term.
The company also has the backing of a major global company in its ultimate parent company, Brookfield Asset Management, Multiplex. While in the short term, revenue may fall again as a consequence of pursuing a handful of major projects and the impact on the commercial sector, Multiplex will remain a bidder for major UK building contracts – but on their own terms.
Winning Work With Multiplex Europe
Multiplex Europe’s general policy is to create long-term working relationships with key individuals and teams that meet robust internal procurement criteria. All opportunities are made open to the supply chain and interested parties asked to complete a pre-qualification questionnaire. Companies are than vetted and successful contractors asked to participate in the tender process. Multiplex Europe tailors procurement depending on individual projects. Before deciding on a procurement route, the group will seek to find out employers’ requirements and corresponding contractors proposals, detailed scope of works, programme constraints including critical path sensitivities, specialist design elements, technical difficulty and interface risk.
Multiplex Europe has used project management specialist Sypro to work with the supply chain about the NEC contract on major projects, such as the Glasgow hospital project. Multiplex Europe’s procurement teams have also attended events, such as Think Different.
Multiplex Europe operates a supply chain management system called Supply Network to collect and maintain supplier data on prequalification status, financial status, contract performance history and workload. New suppliers can access the system here.
Queries over pre-qualification and this system can be sent to: eusupply@brookfieldmultiplex.com
Key Multiplex Europe procurement contacts include:
Commercial director – Brendan Furlong, tel: 020-7659-3500
Brendan.furlong@multiplex.global
Head of supply chain – Chris Fairhall, tel: 020-7659-3500
Chris.fairhall@multiplex.global
Procurement manager – Bruce Hewett, tel: 0141-245-5650
Digital construction lead – Michael Hoare, tel: 0141-245-5650