黑洞社区

North Midland Construction has seen turnover fall 18% and pre-tax profit plummet 91% in the first six months of 2012.

In a statement to the City, the firm said pre-tax profit in the six months to 30 June 2012 was down to 拢115,000 from 拢1.3m in the first half of 2011.

However, its 2011 half year profit had been boosted by an exceptional item of 拢1.2m from the successful appeal of a fine imposed by the Office of Fair Trading.

The firm also saw revenue decline 18% from 拢91.3m over the same period in 2011 to 拢74.8m.

The firm鈥檚 building and civil engineering division reported a loss of 拢0.28m for the first six months of 2012, which Robert Moyle, chair of North Midland Construction, said was due to a 鈥減roblematical major project inherited from the building subsidiary鈥�.

He added: 鈥淢ajor resources have been committed to the completion of the principal loss-making contract and the associated contractual claim and once this occurs, the division鈥檚 performance will progress.鈥�

He said: 鈥淭hese results are extremely disappointing and are exacerbated by one off provisions and the overall decline in UK construction sector output, which has become significantly more pronounced in the first half of this year.

鈥淩estructuring is ongoing to reduce the cost base to accommodate this market shrinkage in the short term and provide a platform for growth in the future.

It鈥檚 highways division also saw profit fall from 拢252,000 to 拢132,000 over the period and it鈥檚 utilities division slid from a profit of 拢595,000 into a loss of 拢219,000 over the period.

Moyle said highways work had been hit by public sector spending cuts.

He also said the utilities division鈥檚 large presence in the telecommunications sector had seen it hit hard by major companies cutting back on expenditure.

鈥淎 restructuring programme had been implemented to deliver significant cost reduction, however the severity and scale of the expenditure cutback will necessitate a further reduction in the scale of the business to match the current market,鈥� he said.