Stewart Milne has maintained his position as one of Scotland's best-paid directors by taking home more than £7.5m in salary, benefits and dividends, it was revealed yesterday, after a bumper year for his building company.
The company's accounts for the year to June 30, 2007, published yesterday, reveal that Stewart Milne Group saw a 50% surge in profits to £42m over the 12 months, its 11th consecutive year of double-digit profit growth, on the back of turnover up 23% to £348m.
Between them, the company's directors shared pay and benefits of £4.4m, of which more than one-third, £1,547,498, was taken by Milne. The company also paid out dividends of £6.2m, of which £6m went to Milne himself.
Milne's total pay packet has actually fallen from last year when he was a beneficiary of a £10.8m package, but £5m of that was in the form of a pension contribution.
Stewart Milne Group has benefited from 17% house price growth in its home market of Aberdeen. Within its homes business, the North division generated turnover of £126m, an increase of 27% on the previous year. It also saw a 52% increase in turnover to £123m in its Central Belt house building division.
Managing director Glenn Allison said: "There was a very strong Aberdeen market with the oil sector and that was in place for the whole year. But we had a strong performance across all our divisions."
Having established itself in Scotland, the group is looking at opportunities south of the border. In September 2006, it bought Manchester-based Nuttall Construction to form the core of a new north-west England business, although it did not contribute to the group's 2007 profits.
The task for 2008 is for the company to establish a division near Oxford, where it already has a timber-frame factory, so it can push into the M4 corridor, Birmingham and the West Midlands.
"In future years the share of our business, which is in the north-east of Scotland and within Scotland itself, as a percentage of the group's business, will diminish as we expand our operations across England," Allison said. "But that doesn't mean that any parts of our business are any less important to us. The north-east of Scotland and Scotland itself provides a very strong platform to allow us to grow and expand."
Allison acknowledges that a slowing economy and a dip in house prices is a concern, although he maintains that Stewart Milne's long-term expansion plans will remain on track.
"I think there are concerns about confidence," he said. "The economy has been impacted by the credit situation. If that continues and leads to a broader lack of confidence in the economy, that would be a concern to us."
Allison won't be drawn on whether the group can maintain its current rate of profit growth, but he said the firm will continue to see profits rising across all divisions.
But he maintains that a business that understands the requirements of its customer base will fare better than most.
He said that all parts of the Stewart Milne Group are doing well. The timber systems business is continuing to see sales growth, especially on the back of strong demand in England and Wales, the company reported. Its construction business also saw a 9% increase in turnover.
Its commercial property arm, which is currently undertaking an office development in Union Row in the centre of Aberdeen that is due for completion in May 2008, is also set to expand. Previously, the company only undertook these on an "opportunistic basis", Allison said. But it now has a team to take a more strategic approach to the market.
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