Manchester's Chinese contractor struggles but plans to stick around

BCEGI Construction (UK) filed its accounts for the year to December 2023 on Christmas Eve 2024. They show the company running at a loss but being under Chinese state ownership, losses present no existential threat.

But while the company itself is free to underperform, the same cannot be said of the directors.

In the year to 31^st December 2023 BCEGI Construction (UK) Ltd nearly doubled its revenues to £47.7m, up from £24.4m in 2022. However, with the cost of sales outstripping revenue generated, the business made a loss – both at operating and pre-tax level – of £8.0m (2022: £5.4m loss).

Total equity in the business is reported at negative £6.9m.

BCEGI’s most notable UK project during the year was on the £135m Wigan Galleries shopping centre redevelopment. It began the scheme, overseeing demolition, before Galliford Try was brought in last year to deliver the first phases of construction work.

The annual report describes 2023 as “particularly challenging” with a small number of projects requiring provisions to be made against potential losses.

On the back of these results, 2024 saw cutbacks and boardroom changes, with new directors brought in to run things, but there are no declared plans for any basic strategy shift.

“The company works for private and public sector customers on projects and frameworks and the activities range from small work to design and delivery of construction projects and we do not expect this to change in the foreseeable future,” the annual report says.

“The company continues to develop and seek further opportunities in the northwest and northeast regions, in both residential and commercial buildings.”

BCEGI Construction (UK) Ltd is part of Beijing Construction Engineering Group Company Limited, whose ultimate controlling party is the State-Owned Assets and Administration Commission of the State Council, The People’s Republic of China. The annual report notes that BCEGI Construction can therefore expect to ride out any economic uncertainty and obtain finance via intercompany loans to operate for the foreseeable future.