For most homeowners, refurbishment projects are deeply stressful. Whether it is a new kitchen, loft conversion or revamp of the spare bedroom, everything costs more and takes longer than predicted – and tempers run high.
Large construction and infrastructure projects are little different. Budgets and time limits are fixed at the outset, but plans go awry, delays happen and expenses pile up. The cost of these overruns can amount to hundreds of millions of pounds, so the stakes are high.
Driver Group specialises in resolving such disputes. The company operates globally, providing teams of experts that help to determine what went wrong, who was at fault and how to move forward.
On track: As infrastructure is boosted, Driver expects more work resolving building disputes
Driver’s shares are at 63p and should gain ground in the next two to three years.
Chief executive Mark Wheeler took the helm less than six weeks ago, but he has been at the company for more than a decade. Driver is in sound hands under his stewardship.
An engineer and surveyor with 25 years of experience, Wheeler has a well thought out plan to expand the business and increase its profits.
He is likely to move into areas of the world where Driver does not have a strong presence, such as the US and Latin America. And he is focused on specialised work, where the group can earn decent returns.
In the past, the company expanded into less profitable, more commoditised fields, such as project management. A couple of poor years followed, a turnaround specialist was brought in and Driver is now back on track.
With extensive operations in Asia, Driver was keenly aware of the danger posed by Covid-19 and moved swiftly to ensure staff could work from home and business could continue.
As a result, the pandemic has had a limited impact to date and, over the longer term, may even contribute to Driver’s growth.
Enquiries are already flooding in from companies whose projects have been stalled or delayed by lockdowns.
Others are seeking advice about how to complete work when social distancing measures are in place, which may cause delays and cost overruns.
Driver offers some guidance online, but it has also run a series of webinars to help customers navigate the current environment. These have proved hugely popular, with 600 to 700 people registering to attend each one. At least some of these should translate into new business in the coming months.
Driver should also benefit from Government plans to kickstart economic growth through big, and sometimes complex, infrastructure projects.
As these move into gear, problems will inevitably emerge and external specialists will be appointed to help solve them.
In charge: Chief executive Mark Wheeler took the helm less than six weeks ago
Driver’s work is hugely varied. A vanity skyscraper in the Gulf is more than a year late and £100million over budget. A road extension programme in Spain has ground to a halt. A British property firm has found most of its flats and offices are covered in cladding, which will cost millions of pounds to remove. An offshore oil rig in Australia is months behind schedule.
Some of these cases end up in court, where Driver’s specialists act as expert witnesses. Often, however, companies are keen to avoid litigation, employing Driver to try to settle issues before the lawyers are called.
The group also helps firms to draft contracts before projects get under way – a kind of commercial prenuptial agreement that helps to avoid confrontation later on.
Founded 42 years ago, Driver has built a reputation as a firm whose people are smart, forensic in their approach and offer high-quality service. Many have been with the group for years and there is an in-house training programme to develop junior employees’ skills.
Back in April, Driver cancelled its interim dividend, but there are hopes that payments will be reinstated soon. The business has been trading profitably, there is cash in the bank and the outlook is benign.
Midas verdict: Prime Minister Boris Johnson wants this country to ‘build, build, build’ its way to recovery, and he is not alone in this. But when ambitions run high and money is tight, disputes are likely. As a building resolution specialist, Driver is ideally positioned to smooth the way. At 63p, the shares are a buy.
Traded on: AIM Ticker: DRV Contact: driver-group.com or 020 7377 0005
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