Outsourcing giant posts 39% drop in pre-tax profit
Outsourcing giant Mitie has posted a 39% drop in pre-tax profit for the year to March 2015, after incurring multi-million pound hits from exiting the M&E and asset management markets.
Mitie posted pre-tax profit of 拢41.5m, down from 拢68.5m the previous year, with the fall largely attributable to 拢72.6m of exceptional costs over the year, including the costs of winding down its M&E and asset management divisions.
Mitie said it successfully exited the M&E market over the period, but incurred a 拢15.9m trading loss in the division鈥檚 final year.
The firm also took a 拢45.7m hit on problem contracts in its asset management business 鈥搘hich Mitie is exiting and absorbing within its energy solutions business 鈥� including a 拢27.2m hit on a single waste wood-to-energy plant in Plymouth.
Mitie said that with exceptional costs discounted it achieved a 1% increase in underlying pre-tax profit to 拢114.1m, up from 拢113.3m.
Revenue also increased marginally to 拢2.3bn, up from 拢2.2bn.
Mitie said its core facilities management business 鈥渃ontinued to perform strongly鈥� over the year.
In the two other main areas in which the firm works 鈥� social housing and healthcare 鈥� the company said it 鈥渆xperienced a challenging year, as a result of pricing pressure in both these markets鈥�, but Mitie said it saw 鈥済ood long-term opportunities to deliver growth in both markets鈥�.
Ruby McGregor-Smith, chief executive of Mitie, said: 鈥溾�滿itie has made good progress this year. We have repositioned the business and lowered our risk profile. Our facilities management business accounts for [circa] 85% of group revenue and is a UK market leader.鈥�
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