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Elements prove profit threat

“LOSING money in this business is very easy,” says Clough Limited managing director Brian Hewitt.

“You have to learn from those bad experiences,” Dr Hewitt said.

“Each project is unique. You’re dealing with the elements. There are substantial risks but I think we can beat most of those.

“Most of the work on our offshore projects is done in the office to help manage that risk.”

Dr Hewitt joined Clough 22 years ago because he wanted to build things.

He spent his early engineering career in government service with the old Public Works Department and the Water Corporation.

“One of the great pleasures of the engineering profession is that you’re in a team creating something that is usually of benefit to the community,” he said.

“If it’s a successful project, it is an ongoing monument to that success.

“Not many professions get to see the results of their work.”

These days most of Clough’s work is below the ocean.

“We’ve just received a letter of intent for a job in the Gulf of Mexico to install some facilities in 2,200 metres of water,” Dr Hewitt said.

“Our first significant offshore project was for Bond Petroleum to install the Harriet facilities off Onslow and that was in 22 metres of water.

“However, that was a significant breakthrough project for us into the offshore oil and gas business.”

That breakthrough helped Clough grow to become a multinational concern.

“In the old days with Clough the whole staff used to eat lunch together,” Dr Hewitt said.

“Now I walk down the corridors and see people I’ve never even met. It’s a bit disconcerting.”

Dr Hewitt said a company only won contracts by presenting the lowest bid.

“Our competitiveness comes though being smarter engineers. We either design things in a different way or come up with a new construction process,” he said.

Dr Hewitt admitted his position took him away from the building side of the company.

“As managing director you get the pleasure of what the whole organisation does,” he said.

“When I’m talking with brokers and analysts, the conversation is almost always about what we’ve built, what we’re building and what we’re going to build.

“At any given time we have about 50 contracts under way – both in Australia and overseas.”

Dr Hewitt said the engineering profession let its practitioners gain significant management experience at a young age.

“In engineering you have two career paths. You can go into design or you can go into management.

“Most engineers have some experience in both but decide to go one way or the other.

“I did a lot of design work as a young engineer and worked my way up to become a project manager. Once you’re doing that it’s similar to being a business manager.”

Dr Hewitt said his role overviewed all Clough subsidiaries, including its Indonesian operations.

“That generates about $150 million for us. We do earth moving and mining work there,” he said.

Clough is expanding in Asia, taking on jobs in Brunei, India and Thailand.

“We took a hit in India,” Dr Hewitt said.

“It was an offshore project that was going well for us but the early onset of the monsoon meant we had to demobilise before the job was finished.

“We have to go back and start all over again. We won another contract in the area which helps.”

Besides running Clough, Dr Hewitt is a keen cruising yacht sailor.

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Engineers

3rd-GHD350
4th↑AECOM300
5th↑CloughNFP
6th-Jacobs Engineering230
7th↑SNC-Lavalin190
145 engineers ranked by number of engineers in WA

Number of Employees

Engineers

Share Transactions

24/04/13
$11k Bought
24/09/10
$2.4m Sold
09/09/10
$1.7m Bought
Total value as at the date of the transaction
Source: Morningstar

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