Carillion Plc Regulatory News (CLLN)

1 April 2015

Carillion wins UK construction contracts worth £123 million

Change to previously announced Al Futtaim Carillion project

Carillion has been awarded contracts and preferred bidder positions by the Select Property Group, to deliver residential schemes at three site across the UK, and by Highways England worth a total of £123 million.

These include a £17 million contract in Newcastle city centre to construct a 260 bed student residence under Select Property Group's Vita Student brand. The development involves the demolition of an existing office block and construction of the residential area on six storeys above commercial units. Work has now started and is scheduled for completion in May 2016.

Select Property Group has also selected Carillion as the preferred bidder for a Vita Student scheme in Partick, Glasgow. This £32 million scheme involves site remediation, construction of a 501 unit residence, a communal hub, significant retail units and associated car park works. The project will be delivered in two phases, with Phase 1 comprising 250 rooms, a communal hub, a retail facility and car parking and is due to complete in September 2016. Phase 2, will include the remaining 251 studios and is due for completion in February 2017.

Carillion has also been selected as the preferred bidder to deliver 260 luxury managed apartments in central Manchester under Select Property Group's newly-launched CitySuites brand. This development includes a mixture of studios, 1 and 2 bedroom apartments, and hotel-style leisure facilities, including an 18 metre swimming pool and fitness suite. The contract, which is worth £34 million, is due for completion in January 2017.

Highways England has appointed a joint venture in which Carillion has a 50 per cent interest to build the £85 million A5-M1 Link Road Dunstable Northern Bypass to improve the east-west connection between the A5 and M1. This new 2.8 mile two-lane dual carriageway, with three new junctions, will improve journey times for long-distance traffic that will be able to use the A5-M1 link as an alternative to the current route through the town centre.

On 25 February 2015 Al Futtaim Carillion (AFC) was announced as the preferred bidder for two projects for Meraas, a Dubai-based holding company. In respect of one of these projects, a £225 million mixed-use development on the Dubai Creek waterfront, AFC has since agreed with Meraas that given this development has become highly dependent on an associated major marine works contract, AFC will not proceed with the waterfront development, which will now be delivered by the marine works contractor. AFC will continue to focus on delivering other major projects for Meraas, which has a substantial pipeline of projects in Dubai. These include several projects related to the current growth in tourism and visitor numbers within Dubai and in support of Expo 2020, including hotels for major international operators, large retail schemes and residential developments.

AFC will also continue to deliver the second major project for Meraas that was announced on 25 February 2015, namely the £155 million, 'La Mer' development at Jumeirah in Dubai. This project involves the construction of a mixture of top-end retail and public-facility buildings, together with substantial external landscaping to create over 1km of beach-themed frontage.

Commenting, Carillion Chief Executive, Richard Howson, said: ''Work winning in UK construction continues to be strong and these recent contract wins have further strengthened our substantial, high quality order book, which we have created through consistently applying our strategy of focusing on large contracts and long-term customers. We look forward to working with the Select Property Group and with Highways England to deliver these important contracts.

"While AFC is naturally disappointed not to be delivering the waterfront development for Meraas, given the risks involved due to the growing dependence of this development on an associated marine works contract, it makes sense for these risks to be borne by, and under the control of, one contractor. We have a strong relationship with Meraas and we look forward to delivering the La Mer development, together with the Avenue Phase II project and further major projects that Meraas has in its pipeline in Dubai."

Notes to Editors

Carillion is a leading integrated support services company with a substantial portfolio of Public Private Partnership projects and extensive construction capabilities. The Group had annual revenue in 2014 of some £4.1 billion, employs around 42,000 people and operates across the UK, in the Middle East and Canada. 

The Group has four business segments:

Support services - this includes facilities management, facilities services, energy services, utility services, road maintenance, rail services and consultancy businesses in the UK, Canada and the Middle East.

Public Private Partnership (PPP) projects - this includes investing activities in PPP projects for Government buildings and infrastructure, mainly in the Defence, Health, Education, Transport and Secure accommodation sectors.

Middle East construction services - this includes building and civil engineering activities in the Middle East.

Construction services (excluding the Middle East) - this includes building, civil engineering and developments activities in the UK and construction activities in Canada.

This and other Carillion news releases can be found at www.carillionplc.com

For more information

John Denning, Director Group Corporate Affairs, Carillion plc + 44 (0) 1902 316426

Finsbury

James Murgatroyd or Gordon Simpson +44 (0) 207 2513801