Revenue also slumps as contract awards are held up
Ardmore has recorded a pre-tax loss of 拢10.8m which it blamed on supply chain failures, delayed contract awards and four problem jobs.
In its accounts to the year 30 September 2023, the London and South-east-focused contractor reported its first loss for seven years.
Turnover was down to 拢403m, compared with the previous year鈥檚 拢435m. Although this represents the second highest level of activity in the firm鈥檚 history, it fell well short of the 拢448m target set by its board.
This year鈥檚 拢10.8m loss follows 2022鈥檚 拢5.1m profit, with cash down at 拢40m from 拢56m in 2022.
Ardmore鈥檚 schemes include the Whiteley鈥檚 Shopping Centre redevelopment in west London, being built by Laing O鈥橰ourke and where it has been delayed by problems with the glazing, and the regeneration of Hornsey Town Hall in Crouch End, north London, which is running around two years behind schedule. Awarded in 2019, the job was originally supposed to finish in 2021.
Managing director Patrick Byrne blamed the loss on the rising cost of materials and labour and working with fixed-price jobs.
鈥淭he rising cost of materials and labour have ravaged all parts of the construction supply chain on fixed price contracts resulting in many corporate failures,鈥� Byrne wrote in the accounts.
He described 鈥渄ifficulties building momentum on four key jobs and delayed contract awards鈥� as contributing to the shortfall.
鈥淲hile inflation has eroded margins across all jobs, the supply chain failures have heavily impacted the margins on three key projects,鈥� he said.
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And the firm said high-profile collapses last year had spooked the market. 鈥淭he failure of major UK contractors has alarmed the supply chain, credit market and customers alike. The bond market has also become much more cautious because of these failures.鈥�
Byrne also said two remaining 鈥減roblem jobs鈥� should be completed within the first quarter of its next financial year.
This year鈥檚 accounts mention recent contract wins totalling 拢530m and say the firm鈥檚 order book of construction suggest achieving 拢400m in 2024 is likely.
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