Contractor reports six month profit slump by more than a third
Contractor Kier has embarked on a 拢12m restructuring programme after reporting a slump in profit of more than a third in results for the six months to 31 December 2012.
The contractor recorded interim profit of 拢20.9m, down by 35% on the 拢32.3m recorded in the same period in 2011, on revenue of 拢976m, down by 6.8%.
Chief executive Paul Sheffield said the firm had written off 拢4.4m in the six month period on restructuring the firm, including a 拢2.1m write-down related to the sale of its scaffolding business. The restructuring will continue in the second half of its financial year, costing 拢12m in total. Kier鈥檚 statement did not say if or how many staff would be losing their jobs.
Sheffield said the results showed a 鈥渟olid鈥� performance in a 鈥渄ifficult environment鈥� and that the firm was restructuring to reflect the 鈥渟cale of future opportunities.鈥�
Sheffield said the firm鈥檚 ability to retain cash was being constrained by the government鈥檚 determination to use project bank accounts on all major projects, and the fact that 鈥減ayment terms within framework agreement are increasingly tightened.鈥�
Kier鈥檚 construction business operated at a 2.1% operating margin over the period, down on the 2.5% recorded at the same point last year, with revenue also down by more than 10%.
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