Modular specialist Reds10 is eyeing the NHS hospital new build programme as a major growth engine as it pushes towards a £500m turnover target.

The firm has designed a prototype modular in-patient hospital bedroom that it hopes will drive the industrialisation of Hospital 2.0 under the government’s New Hospital Programme.

If signed off by the NHP, the bedroom could become the standardised in-patient room rolled out across the entire programme, giving the NHS a repeatable modular solution to speed up delivery of the next generation of hospitals.

The healthcare push comes as Reds10 sets up for its next phase of growth after posting stable revenue £145m revenue for the year to 31 March 2025 and doubling down on investment in advanced manufacturing, data and automation.

The modular builder delivered a 4.8% operating margin, with pre-tax profit also steady at £7m.

The business remains debt free, with £20m cash on the balance sheet, and is forecasting around £160m revenue in the current year.

Two of its five factories at its Driffield manufacturing campus are now operating fully industrialised processes, supported by increased automation and data-driven design.

The firm’s secured pipeline stands at more than £350m, underpinned by long-term programmes across defence, education and justice.

Reds10 is one of five contractors appointed to the Defence Infrastructure Organisation’s alliance to deliver Single Living Accommodation for the Armed Forces, holds a place on the London Construction Programme public-sector education framework, and is appointed to the NHS Shared Business Services Modular Buildings 3 framework.

Alongside health, Reds10 is targeting expansion in affordable housing and temporary accommodation.

Chairman Paul Ruddick said the business was proving that volumetric construction can work with the right strategy.

“Reds10 is proud to be bucking the trend in the volumetric sector,” he said. “While many businesses have struggled, we’ve demonstrated that volumetric construction works when you diversify across multiple income streams and take a long-term, patient approach.

“This year marks a turning point for us. Following a period of consolidation and significant investment in our manufacturing facilities and data platform, we are now driving the wholesale industrialisation of design, production and construction processes, with AI integrated at every level.

“Looking ahead, we see enormous potential in health and residential markets, where our industrialised model can deliver at scale. This is just the beginning of the next phase of growth for Reds10.”