Results from UK retail fit-out specialist contracting group Styles & Wood received a boost from projects for retail banks, and its SaaS property management solutions subsidiary, iSite, also seems to have benefited. Yesterday’s results announcement highlighted “expansion of our iSite property management systems business with Tesco and Nationwide Building Society.”
Revenues and profits for the whole group were both up fractionally on 2010’s result, with over 80% of the group’s revenues arising from its ‘Construct’ operations, though the CEO Tony Lenehan notes a benefit to iSite of being part of a contracting group: “The promotion of cross-selling of other service lines such as Design and iSite has proved a notable success.”
Looking specifically at Nottingham-based iSite, the information services business grew revenues 18% from £1.242m to £1.460m (the best result since 2007 – see above), with a profit of £0.278m (up £7k from 2010; post) and margins a bit tighter at 19%. iSite (previously known as StoreData) has been consistently profitable since 2005 (below).
The CEO’s report says:
“We are developing our product range and, through collaborative working arrangements with key customers such as Tesco and Nationwide, we are establishing a sound platform for growth. Profit contribution in the period is in line with the prior year and reflects in-year investment for future business opportunities.”
It also notes:
“A formal agreement has been ratified with Nationwide Building Society to jointly promote the suite of management systems, termed “the Hub”, which we have developed for their property portfolio. This collaborative arrangement provides a robust platform to selectively target sales growth in this area.”
I met iSite’s Martin Ward earlier this year at Styles & Wood’s new London office close to Smithfield Market. He told me iSite was seen as a long-term project targeting efficiency improvements in clients’ property portfolios. He highlighted how the system had helped key customers such as Nationwide and the Co-op reduce headcount while still managing scores of branch refurbishments, and how customers could see a clear link between capital spend on property assets and sales results. And iSite was not just being used by commercial organisations, he said – local authorities had also been looking to use the system.
Such diversification may provide more resilient and predictable future revenues than might be achieved through a focus on retail clients. The business is also well-placed to capitalise from further cross-selling within the parent group’s framework deals with major construction customers, while its Nationwide “Hub” partnership could also boost revenues.