Gas pipeline engineer Fulcrum Utility Services (FCRM:AIM) is on a roll. Now profitable after a tough restructuring over the past few years, it has received another boost in the form of a £3.95 million contract to build 13km of gas pipeline in Scotland.

Shares in the small cap are up 5.4% this morning at 19p, valuing the business at £30 million.

FCRM - Comparison Line Chart (Rebased to first)

The deal, the second-largest in Fulcrum’s history, is being funded by London-listed beverages giant Diageo (DGE) and distilleries Chivas Brothers and Ian MacLeod.

In 2014 it delivered a similar £7.6 million, 16 mile (25.6km) pipeline project for Diageo, Chivas and Angus Dundee. At £304,000 per kilometre, the recent deal’s pricing looks a little better than £297,000 achieved on the larger project. As part of the package, Fulcrum has engineered a specialist solution to carry the pipeline across a river at Carronbridge.

Fulcrum, previously part of National Grid (NG.), has been a rare blot on the copybook of respected investment firm Marwyn Value Investors (MVI), which brought the stock to market via an initial public offering (IPO) in 2010.

Loss-making from the outset, the business has taken longer to restructure than expected. Chief executive Martin Donnachie, appointed in 2013, has overseen an impressive turnaround which delivered a £606,000 pre-tax profit in the year to 31 March 2015.

Now Donnachie is positioning the business for growth by aiming for major project wins, improving key account relationships and increasing penetration in the housing market.

Issue Date: 17 Jul 2015