In recent years, water companies have focused on improving their pipeline systems in order to minimise leakage. Derby-based McLoughlin Group has benefited from this, and derives 70% of its turnover from short-term contracts laying pipelines for water companies. The remainder is derived from pipeline work for the gas industry. Profits have increased by 39% pa, from £1.6m in 1995 to £4.2m in 1998. Sales grew by 22% pa in the same period to reach £28.3m in 1998. Finance director Kent Taylor explains that a rise in productivity brought about by new and sophisticated technology has boosted the company’s margins. Previously, tunnels had to be excavated by a team of diggers, and the pipes were also laid manually. McLoughlin has invested in machines that first bore a horizontal tunnel, up to 200 feet at a time, and then pull the pipe into it, saving both time and manpower. In September 1998 the Group was sold to management, who obtained £33.7m backing from venture capitalists 3i.
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