Profit at fit-out specialist Structure Tone has risen by 17 per cent, as the firm picked up projects and talent in the wake of the high-profile collapse of ISG.
The company’s pre-tax profit rose from £1.28m to £1.5m, while turnover swelled from £134m to £175m.
The estimated future value of contracts awarded last year was £187m, up from £92m the year before.
The London-based firm, ranked third in CN’s fit-out index last year, said it had benefited from the fallout of ISG, as well as a surge of activity in the sector.
The sudden departure of a major contractor from the market brought with it both risks and opportunities, it said, noting that “2024 will be forever remembered as a pivotal year for the London fit-out market”.
In a strategic report accompanying its annual report and financial statements for the year ending 31 December, it said 2024 was marked by “the disruption of the ISG Group going into administration, alongside a notable and expected surge in activity within the sector, evident from the last quarter of the year”.
Commenting on its future outlook, the report said: “Project disruptions, supply chain ripple effect, labour market dynamics, market confidence and economic impact all pose significant risks which need to be carefully navigated.
“On the plus side, competitors are presented with [a] great opportunity with halted projects needing to find a new home, alongside a readily available pool of experienced talent in the market.”
In September, the firm snapped up former ISG chief executive Matt Blowers as joint managing director, and started to attract a string of projects and teams left in the lurch by the failure of ISG, almost doubling its headcount in the process.
“Structure Tone’s corporate strength, agility and experience in the market allowed our enabling teams to work tirelessly to ensure a smooth transition for both clients and supply chain,” it said.
The company noted that the fit-out market had experienced a significant rebound, particularly in London.
“Recent data indicates that leasing activity has picked up since the low point in early 2024, with an average of around 4.3 million square feet leased over the last three quarters,” it said.
“The uptick in leasing activity suggests a growing demand for office refurbishments and new fit-outs, with premium properties in central locations continuing to command high rents and a ‘flight to quality’ trend.”
However, Structure Tone warned that geopolitical risks would continue to dominate the economic landscape in 2025, fuelling uncertainty among investors and around the cost and accessibility of raw materials.
At a more local level, it said volatility within the supply chain, increases in the cost of living and rises in employer taxes remained significant concerns.