Hercules plc (LON:HERC) Chief Executive Officer Brusk Korkmaz caught up with DirectorsTalk to discuss £5 million of new civil project contracts, investment across the UK water sector, the development of the Civil Projects division and future growth opportunities.
Q1: Hercules has announced around £5 million of new civil project contracts in the final quarter of FY2026. Could you just tell us a little more about the work you have secured and what this means for the business?
A1: We’re very pleased with these contract wins. They represent around £5 million of additional work secured in the final quarter of financial year 2026. Most of the work is in the Thames Water region and includes a range of civil engineering and infrastructure projects.
For us, this is another important step forward for our Civil Projects division.
During the year, we have continued to build our in-house capabilities so that we can deliver more of these projects ourselves. These latest contract wins show that our strategy is working.
We are combining our experience in the water sector with a stronger delivery capability. It also gives us a very positive platform as we move into financial year 2027.
Q2: Now, as you mentioned, the majority of these contracts are within the Thames Water region and support the wider AMP8 investment programme. How significant is the opportunity that you see across the UK water sector over the coming years?
A2: We believe the opportunity in the water sector is very significant.
As you might be aware, AMP8 represents a major programme of investment, with more than £104 billion expected to be invested across the sector between 2025 and 2030.
Hercules already has a good reputation and experience operating in the water sector for the last 18 years. We also have strong relationships with our clients, so we believe that we are well positioned to benefit from this huge investment programme.
Importantly, we are no longer looking at the market simply as a supplier or subcontractor. We are developing our civil engineering capability so that we can deliver a much wider range of infrastructure projects.
This also gives us the opportunity to win larger and more valuable projects and to build even stronger long-term relationships with our clients.
We see the water sector as an important area of growth for Hercules over the coming years.
Q3: You refer in the announcement to the growing capability of the Civil Projects business to self-deliver infrastructure projects. How has that capability developed during FY2026? What does it allow Hercules to do that perhaps it couldn’t do previously?
A3: This has been an important area of progress for us during financial year 2026. We have continued to invest in our people, in our delivery capability within the Civil Projects division.
As a result, we can now self-deliver more elements of the infrastructure projects rather than relying as much on third parties.
That gives us greater control over safety, quality, cost, and the programme. It also means that we can offer our clients a more complete service and take responsibility for a larger part of the project.
Most importantly, it allows us to compete for a wider range of opportunities to build stronger long-term relationships with our major infrastructure clients.
We believe that this will be an important part of our growth strategy in 2027 and beyond.
Q4: Now, you’ve built a strong track record in the water sector. How are you using that experience and those client relationships to identify and win further opportunities?
A4: Our experience in the water sector is becoming a real strength for Hercules.
We understand our clients, we understand the environment that they are working in, and we also understand what’s required to deliver these projects safely and efficiently.
We have also built strong relationships across the sector, and those relationships help us to spot future opportunities earlier and allow us to work closely with our clients to find out the solutions that they require.
Our focus is now using our experience, our people, and those relationships to win further work. At the same time, we will continue to focus on delivering our existing projects safely and to a high standard.
If we continue to deliver well for our clients, we believe more opportunities will follow.
Q5: Just looking ahead to FY27, what are the key areas of opportunity for the Civil Projects business and how do you see the division contributing to Hercules’ wider growth ambitions?
A5: We are very positive about opportunities for Civil Projects in financial year 2027 also. AMP8 and the level of investment in the UK water sector will clearly be an important part of that.
We also see opportunities to use our growing civil engineering and infrastructure capabilities across other parts of the UK infrastructure market.
Over many years, Hercules has built a strong reputation in the infrastructure sector over the last 18 years, as I mentioned, for delivering safely, reliably, and professionally. That reputation, together with our existing client relationships, gives us a strong foundation to win further work and enter new areas of the market.
Our approach will continue to be controlled and very well disciplined.
We want to win good-quality projects, deliver them safely and efficiently to continue to build and, sorry, and continue to build our track record of relationships with our clients. We have built a strong platform, a trusted reputation, and a growing delivery capability.
I believe our Civil Projects division can deliver more and it’s becoming more important for us, for Hercules, and making a meaningful contribution to our overall group’s growth and profit.
We believe that our Civil Projects division will carry on growing over the next five years.
Q6: Finally, with more than £104 billion of investment committed to the UK water sector under AMP8, how much of that opportunity do you believe is realistically addressable by Hercules? Where do you see the greatest potential for growth?
A6: We’re currently working in the Thames Water, Southern Water, Anglian Water, Severn Trent Water, Wessex Water and Yorkshire Water regions.
We are going for, over the next five years, as many projects as we can deliver within reason, obviously, that we have to deliver efficiently, safely and to a high quality. So, we are building up our team accordingly.
As you might have seen from our results last year, we delivered around £16 million worth of civil projects. We believe this year is going to grow more as well as we will be adding onto this exponentially.
We believe that hopefully within the next five years, that number could go as much as £50 million-plus per year in delivery. So, we’re going to go for it.
We’ve got a good team, good reputation, and we have been in the water sector over the last 18 years.
