Back in September 2021, the Government pledged to spend £650billion on infrastructure projects across the UK, from hospitals to roads to power stations. Much has changed since then but we are still in urgent need of investment in schools and hospitals, enhanced transport links and a more secure energy system.
All this activity requires not just billions of pounds but also thousands of workers. The construction industry already employs more than two million people but researchers predict that it will need at least 250,000 more by 2026. Hercules Site Services is helping to bridge the gap. The company joined the AIM market last February at 50.5p a share.
The stock has since fallen to 42.5p, but the price should recover and then some as chief executive Brusk Korkmaz flexes his muscles and shows what Hercules is made of.
Big customer: More than 7,500 workers have registered with the app with several hundred already busy on the HS2 railway project
Korkmaz came to the UK from Turkey in 1998 to study civil engineering at University College London. Ten years later, he founded Hercules from his bedroom, sourcing and supplying construction workers for contractors.
The company has grown consistently since then, providing top businesses such as Balfour Beatty, Kier and Skanska with workers ranging from bricklayers, plasterers and pipelayers to engineers, foremen and supervisors.
From the start, Hercules has had a digital slant, using technology to make the recruitment process as simple and effective as possible. In 2019, Korkmaz went one stage further, creating the Hercules app which allows users to find out instantly about jobs that are relevant to them and in their local area.
More than 7,500 workers have registered with the app and numbers are growing fast. Hercules vets applicants and – once they have been approved – Korkmaz and his team make it their business to keep app users in work.
Several hundred are already busy on the HS2 railway project, with others laying fibre cables in Kent, upgrading the M42 near Birmingham and fixing waterworks in London. Hercules aims to ensure that workers can move seamlessly from job to job, without having to travel far from home.
And, even though labourers are contracted out to big building firms, Hercules takes charge of paying them and looking after them. Korkmaz takes this part of the business particularly seriously, ensuring that workers receive a decent wage and are paid on time.
He also sends mobile health and wellness units to various sites offering medicals, hearing and eye tests, even lung function analysis and wellbeing assessments to anyone who wants them.
Korkmaz is a real advocate of inhouse training as well, intending to open a specialised academy in Nuneaton, Warwickshire, next year to attract new workers into the construction industry and help existing labourers to learn new trades.
Planning applications have been submitted and local authorities are keen so there are high hopes that Hercules will receive the green light within the next few weeks.
Connected: Laying internet cables
Labour supply accounts for some 75 per cent of Hercules’ revenues, but the group also offers contractors help with individual projects, managing and delivering them from start to finish where needed, often using topnotch technology to complete jobs efficiently and at low cost.
The firm has one final string to its bow, providing specialised kit to construction sites, particularly suction excavators, big machines which make below ground excavation safer, faster and much more effective than traditional, more manual methods.
Korkmaz, 43, is energetic, hardworking and determined to build Hercules into a business that is successful and delivers for its customers, but also makes workers feel valued.
Results so far are encouraging. Figures for the year to September 30 will be announced next January but, earlier this month, Korkmaz said revenues would be more than £45million, up around 38 per cent ahead from 2021, while profits are likely to show strong growth too.
Unusually for a small, AIM-listed business, Hercules pays a dividend as well, with 1.7p offered to shareholders for the year to last September and payments expected to increase steadily in line with profits.
Midas verdict: Based just outside Cirencester, Hercules is a fast-growing UK business with robust long-term prospects. Britain’s infrastructure is creaking at the seams, several projects are already under way and more should follow. Hercules can supply these schemes with trained, local labourers and specialised safety kit. At 42.5p, the shares are a buy.
Traded on: AIM Ticker: HERC Contact: hercules-construction.co.uk or 01793 336851
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