Under the Defence Reform Act 2014, the SSRO must provide the Secretary of State with its assessment of the appropriate rates used to determine the contract profit rate for pricing qualifying defence contracts and qualifying sub-contracts. Part of the methodology is the categorisation of comparator companies into four activity types.
- Develop, Make and Support
- Ancillary Services
- Construction
- Information Technology Services
The results of these groups are separately analysed and this factsheet describes the Construction group results.
For further information on the methodology used to calculate these rates please see the Single Source baseline profit rate and capital servicing rates methodology.
Construction
Companies undertaking comparable activities considered as ‘Construction’ are expected to deliver services in relation to the construction of buildings or other structures at fixed locations. Companies could provide such services either on a contract basis with designs and specifications received or using their own designs. Comparable companies may be responsible for the management of the construction project, and are likely to bear contract risk, procurement risk, staff risk and some quality control risk in respect of these activities. They are not expected to bear any significant property price risk in respect of these activities.
Profit on cost of production
| 2022/23 | 2023/24 | 2024/25 | 2025/26 | 2026/27 | |
| Underlying rate (unadjusted for capital servicing) | 4.03% | 4.54% | 3.68% | 3.67% | 4.48% |
| Capital servicing adjustment | -0.29% | -0.30% | -0.18% | -0.36% | -0.58% |
| Underlying rate | 3.74% | 4.24% | 3.50% | 3.31% | 3.90% |
| Rolling average[1] | 3.33% | 3.44% | 3.58% | 3.68% | 3.57% |
Note: The capital servicing adjustment accounts, at an aggregate level, for different levels of capital employed across the companies in the index and so sets a baseline upon which step 4 of the contract profit rate applies.
[1] A four-year average was used for 2022/23; a three-year average for pre-2022/23 and a three-year average (excluding 2022/23 underlying rate) for 2023/24 onwards. The pre-2022/23 underlying rates used for the three-year average were: 2021/22: 3.01% and 2020/21: 3.07%.
Data sources
For further information on the data selection approach please see section 7 of the Single Source baseline profit rate and capital servicing rates methodology. A company update search of the Orbis database was carried out on 3 November 2025 on data update number 369001 using software version 369. The financial data for the calculation was extracted from Orbis at the same time.
Median capital servicing adjusted return on cost of production
Proportion of companies by country
Proportion of companies with defence keyword
Supplementary statistics
| Number of companies | 91 |
| of which profit making | 84 |
| Aggregate turnover (£billions) | 179.4 |
| Total capital employed (CE) (£billions) | 0.68 |
| Average company CP:CE ratio | 244.77 |
Source: Orbis (Cash figures shown in rounded GBP Billions)
Names of companies in the index
| 3B Construction LTD |
| Acre 1217 Limited (J) |
| Acs, Actividades de Construccion Y Servicios, SA (J) |
| ADF Group Inc. |
| Aecon Group INC * |
| AF Gruppen ASA |
| Anvolia (J) |
| Bach Gruppen Holding A/S (J) |
| Balfour Beatty PLC |
| Bermar Building Company Limited |
| Bespoke Construction Services Limited (J) |
| Billington Holdings PLC |
| Bowmer and Kirkland Limited |
| Bravida Holding AB |
| Brims Building Group Limited (J) |
| Byggpartner I Dalarna Holding AB |
| C. P. W. Services Limited (J) |
| Chrysalis * |
| Consti OYJ |
| Construcciones Ecay SL (J) |
| Construcia SL (J) |
| Construction Concept Europe, LDA (J) |
| Cooperative Metropolitaine d’Entreprise Generale * (J) |
| Costa & Carreira, LDA (J) |
| Costeira – Engenharia E Construcao, S.A. (J) |
| Econor Holding AS (J) |
| Ecosoer Holding AS |
| Edimarante – Sociedade de Construcoes, S.A. |
| Ekter S.A. (J) |
| Elektro AS |
| Emcor Group, Inc. |
| Entreprise Maurice Picard et Compagnie (J) |
| Fareham Associates Limited (J) |
| Fordy Thompson (Holdings) Limited |
| Galliford TRY Holdings PLC |
| Genere (J) |
| Geoffrey Robinson Limited (J) |
| GLB Holding AS * (J) |
| Grupo Empresarial SAN Jose S.A. |
| Gruppo Koni S.R.L. (J) |
| Hannon Brothers Limited (J) |
| Harald Nilsen Holding AS (J) |
| Hardwicke Investments Limited |
| Harper Group Management Limited |
| Hiag Immobilien Holding AG (J) |
| Implenia AG |
| Inasus SL (J) |
| Instalco AB (J) |
| Intelle Construction Limited (J) |
| Irem S.P.A. (J) |
| John Graham Holdings Limited (J) |
| John Reid & Sons (Strucsteel) Holdings Limited (J) |
| John Weaver (Holdings) Limited |
| K 21 Entreprenad AB |
| Kier Group PLC |
| LES Macons Parisiens * |
| Lindum Group Limited |
| LTR-Rakennus Oy (J) |
| M & P Construction Limited (J) |
| M.P.B. Structures LTD |
| Mace Finance Limited |
| Manco South Limited (J) |
| Mares S.R.L. (J) |
| Martifer Sgps S.A. |
| Mitchellson Formwork & Civil Engineering Limited |
| MMD Construction (Cork) Limited (J) |
| Morgan Sindall Group PLC |
| MTX Contracts Limited (J) |
| NG Bailey Group Limited |
| Northern Bear PLC |
| O’Connor, Sutton, Cronin & Associates Limited (J) |
| Oliver Connell and SON Limited |
| Oy Rakennuspartio * (J) |
| Paul Earl Limited (J) |
| Peab AB |
| Porr AG |
| Putkiwuorio Oy |
| Rakennusliike J. Malm Oy |
| ROE Developments (UK) Limited (J) |
| Skanska AB |
| Spritestore Limited (J) |
| stahl + verbundbau gesellschaft fuer industrielles bauen m.b.H. |
| Subsea 7 SA |
| SWB Holdings Limited (J) |
| Tutor Perini Corporation * |
| VAN Huele |
| Varden Gruppen AS |
| Veidekke ASA |
| Vinci |
| Wates Group Limited |
| WYN Construction Limited |
* Indicates that the company is a loss-maker in the year.
(J) Indicates a company which was not in the activity group last year but has been added this year.