13/06/2013 - 14:18

Primero offers the full package

13/06/2013 - 14:18


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Primero offers the full package
PRIME MOVERS: Primero Group directors (from left) Peter Grigsby, Cameron Henry, Ryan McFarlane and Dean Ercegovich. Photo: Bohdan Warchimij

Engineering and construction company Primero Group has enjoyed enormous growth in its brief existence.

Like many great ideas, a decision by the founding directors of engineering and construction firm Primero Group to establish their own business came to life over a few beers at the pub.

"I guess lunchtime conversations on a Friday afternoon at the pub were always made up of 'one day we're going to do this ourselves'," managing director Cameron Henry told Business News.

"The rolling stone gathered some momentum on some overseas trips that I and one of the other directors were doing for a project. We basically decided to put the company together and start it as an entity long before we traded just so we had something there."

At the time, Mr Henry and two fellow directors were working with listed engineering firm Forge Group, and believed there was a gap in the market for a smaller player.

In particular, they saw an opportunity to deliver quality turnkey design and construction packages for clients developing smaller projects in the mining, oil and gas, petrochemical and critical infrastructure sectors.

The results for Primero Group have been impressive, with annual turnover forecast to almost double for the 2012-13 financial year on the back of several design and construction contracts.

Its staff numbers have swelled from 20 to 55 over the same period, forcing the company to twice take out a larger office space to accommodate its growing business.

In a competitive market, Primero Group's capacity to deliver a comprehensive range of services had given the company an advantage over others, Mr Henry said.

"We're promoting the EPC mentality, which is a contracting strategy and style that I think over the last five years or so has probably fallen away from the market," he said.

"Rightly or wrongly, through the last year and a half of shakeups in the industry, that contracting style has become more attractive."

In early 2012, just less than a year after the company was established, Primero Group secured its first major contract – a $12 million design and construction upgrade for Atlantic Resources' Windimurra vanadium processing plant near Mount Magnet.

With little infrastructure in place and just a six-month timeframe to work to, delivering the project on time represented a major challenge for the young company.

"They came to us with a very, very tight schedule and basically just a back-of-the-cigarette-packet sort of concept," Mr Henry said.

"We sketched up the concept and developed it into something that was real and then designed, fabricated, procured all the equipment and constructed the facility probably within about five and a half months, which from absolute concept inception was a pretty amazing timeframe.

"It was a very tight framework to deal with and we delivered the end-result on time."

With this initial success under its belt, Primero Group turned to shoring up the business.

The company hired more staff, invested in infrastructure and separated its labour hire business (now known as PGC Resources) from the main engineering and construction business to mitigate confusion around the firm's dual functions.

Primero Group's directors also declined an offer from a third-party to purchase the company, believing it was too early to walk away from the business they had established.

While slowing investment in the resources sector has prompted mining services firms to cut costs, Mr Henry said Primero Group was well placed to compete for smaller projects.

"A lot of these bigger (engineering and construction) companies are at the size now where they're not competitive on projects that size," he said.

"Projects that size attract the B or E or F team and they usually end up delivering a poor result for the client.

"I think it's very exciting for a company like us because it's always onwards and upwards rather than having to contract and shrink to the external factors of the market."

While Primero Group's immediate focus remains consolidating its significant growth, it is likely to turn a growing focus to oil and gas in the coming years.

The company recently completed its first onshore gas processing facility, Empire Oil and Gas' Red Gully project, and plans to expand into the eastern states are in the pipeline.

"We see ourselves as being a group that doesn't just limit ourselves to one product or one service and we think that insulates us a lot from downturns and slowing down of the industry," Mr Henry said.



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