A PAISLEY electrical engineering group that was launched after its boss’s former business went into administration last year is on course to deliver turnover of £2.5 million in its first year of operation.

Mark Ward, who launched electrical contracting and street lighting firm Power One last September, said the firm was expecting to achieve the figure alongside a net profit margin of 21 per cent. That would put profits at around £500,000.

“It’s been a successful year and we’ve done really well because the team has worked really hard, doing seven days a week,” he said.

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Having started off working on small contracts in the telecoms sector, the firm is focused on gradually building up its business, taking on LED street lighting projects across Scotland and also doing work at Kelvingrove Art Gallery and Museum in Glasgow.

Mr Ward said the firm is also in the running for a number of larger projects in the telecoms industry that would help push its turnover to £4m this year and £6m the year after.

It comes after the original iteration of the business, Power 1 Electrical Contractors, went into administration last September following a dispute with FTSE 250 construction firm Galliford Try.

That related to a project in which Galliford Try sub-contracted Power 1 Electrical Contractors to install street lighting for Northumberland County Council.

Power 1 Electrical Contractors’ administrators – Brian Milne and Eileen Blackburn of French Duncan Restructuring and Debt Advisory – said when they were appointed that the business failed after experiencing cashflow difficulties as a result of its relationship with Galliford Try.

In their initial report to creditors Mr Milne and Ms Blackburn wrote that “the insolvency of the company was largely due to the dispute with Galliford, who, according to the company’s books and records, owe the company in excess of £3m”. They added that “the non-payment led to a major cashflow issue”.

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Galliford Try disputes the claims made against it, with a spokesperson for the company saying that it met all its contractual obligations to Power 1 Electrical Contractors.

“Our policy is always to deal fairly and promptly with subcontractors, suppliers and clients and we were sad to see the previous Power One business go into administration last September,” the spokesperson said.

“Payments were made to Power One through the course of the project in line with the terms of the contract, including payments made ahead of time to assist them with their cashflow issues at the time.

“The additional monies claimed by Power One and now the administrators, refer to speculative sums projected from potential legal disputes and are very much over and above what they were entitled to for the work completed under the contractual terms.”

As a result of the administration, Power 1 Electrical Contractors, which turned over around £8m, laid off its entire 65-strong workforce.

Power One now employs 23 people and Mr Ward said the intention is to expand its workforce and the sectors it serves with the help of some external investment.

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“I’m looking to bring on some private equity or venture capital backing,” he said.

“Once we’ve got the first year out of the way we’ll potentially go to market.

“We’d look to raise around £5m, depending on what markets we want to break into.

“It will be in FY2 that we’ll look to bring an equity partner on board.”

Mr Ward said that with the launch of 5G wireless networks “just around the corner”, he expects the business to benefit from the growth in the internet of things.

He added that the new business will not be looking to follow Power 1 Electrical Contractors into the construction sector.

“It’s too much of a risk and it's often not until nearing the completion of contracts that things start to go wrong and smaller companies become exposed,” he said.