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Profit at JRL Group fell more than 50% to the lowest level it has seen for eight years after a 鈥渄ifficult year鈥� in 2022, according to accounts for the main contractor and specialist builder.

JRL Group, which is the group entity for both groundworks and concrete frame specialist J Reddington and main contractor Midguard, reported pre-tax profit of 拢13.3m for the 2022 calendar year, just under half the 拢26.8m reported in 2021, despite sharply rising revenue.

The firm said turnover grew by 25% to 拢761m, its highest ever. However, the pre-tax profit figure was its lowest since it reported a 拢3.9m return in 2015, and the first time since that year it has fallen below a 2% pre-tax margin.

Within the group figures, the firm said J Reddington itself made a pre-tax loss on 拢1.6m on 拢396m turnover, while Midguard made a healthy profit of 拢25.3m on turnover of 拢536.3m.

The firm also includes a number of other major specialist contracting subsidiaries, covering everything from crane hire, plant and logistics, drylining, civil engineering and M&E contracting. The results showed that JRL Group鈥檚 unitised facades contractor, McMullen Facades, reported a significant pre-tax loss of 拢21.8m after expanding turnover from 拢65.2m in the prior year to 拢128m.

JRL said McMullen had experienced 鈥減oor performing contracts and inflationary pressures鈥� and that in response to the loss, 鈥済reater resources and enhanced design capabilities are now in place鈥�, alongside an 鈥渋ncreased focus on cost control and efficiencies鈥�.

Chairman John Reddington said 2022 was 鈥渁 difficult year for the construction industry鈥� with 鈥渋nflation at an all-time high鈥�.

However, he added that while JRL鈥檚 in-house delivery model couldn鈥檛 completely protect the firm from the impact of inflation, it 鈥渄oes save us from supply chain failures and excessive mark-ups鈥�.

Reddington said JRL Group was now accessing new and more economic markets for materials to reduce costs, and had invested in a modular factory to further address cost pressures. He said: 鈥淚nflation has stabilised, we have a healthy orderbook and with a motivated team we look forward to better results in the coming years.鈥�

The results statement said the firm was pleased with the 鈥渟trengthening of the group鈥檚 financial position鈥�, with the net assets on the balance sheet increasing to 拢142m, from 拢130m last year. However, the accounts also showed that net debt increased to 拢64.2m, from 拢14.6m in 2021.