黑洞社区

Mace鈥檚 pre-tax profit has fallen by 拢25.5m, down from 拢36.2m last time, to just 拢10.7m in 2016.

The fall is being blamed on its work at Land Securities鈥� 拢2.2bn mixed-use scheme called Nova in London鈥檚 Victoria district and a 46-storey PRS tower called Highpoint in Elephant and Castle, 黑洞社区 has learned.

Phase one of Nova 鈥� which includes 480,000 sq ft of office space across two buildings and 170 apartments 鈥� finished in April, over six months late. In May, Land Secs said the scheme was late and over budget with the developer blaming the 鈥渃omplexities of construction 鈥� together with competition for labour in a busy sector鈥�. 

Mace was main contractor on the scheme and two years ago was forced to replace the concrete contractor after PC Harrington Contractors went into administration.

But there was some better news for the firm as it said it was approaching its 拢2bn turnover target four years earlier than planned, according to a snapshot of the company鈥檚 results.

The firm reported that group revenue had risen to 拢1.97bn in the year to December 2016, up from 拢1.73bn for the previous year.

Mace also reported that its bidding pipeline at the end of 2016 stood at 拢4.5bn and it had a 拢2.35bn pipeline of work that it was confident would be converted into firm contracts.

The group鈥檚 cash balance at the end of last year stood at 拢117m, 4.9% lower than at the end of 2015.

Current projects for the firm include Heathrow鈥檚 third runway, Northern & Shell鈥檚 redevelopement of Westferry Printworks in London鈥檚 Docklands, while it is carrying out work to build Tottenham Hotspur鈥檚 new stadium in north London ahead of that scheme being completed in time for the start of the 2018/19 Premier League season.

Mace is also understood to have bagged the construction manager job on developer Sellar鈥檚 26-storey Shard Place at London Bridge and is one of fuve in the running for the London School of Economics鈥� 拢140m new education centre in London鈥檚 Holborn district.

Stephen Pycroft (pictured), chairman at Mace, said: 鈥淪uch unprecedented growth brings with it certain challenges in terms of delivery, not to mention the impact of the industry-wide issues we predicted in last year鈥檚 annual report and additional issues such as high risk projects, incomplete designs and a reliance on the performance of our construction partners.

鈥�2016 has taught us some very valuable lessons and as a result, we have put in place additional measures to prevent these problems happening again.鈥�

Commenting on the UK鈥檚 vote in favour of Brexit, Pycroft added: 鈥淚n the short term this decision had minimal impact, but looking ahead to the longer term the pipeline has unsurprisingly become more uncertain. It is likely that as the UK鈥檚 future relationship with the EU becomes clearer, the pipeline will also increase in clarity.鈥�

Mark Reynolds, chief executive at Mace, added: 鈥淎fter a number of years of tremendous growth, it is fair to say that 2016 was a mixed 12 months for Mace. Whilst our turnover grew to 拢1.97bn our profits fell to 拢10.7m which is below our 2020 target. 

鈥淭his was due to a small number of challenging construction projects which were secured at the end of the recession.

鈥淭here are many lessons to be learnt and I would like to thank all of my colleagues for their commitment to delivering outstanding buildings in what are sometimes very difficult circumstances.鈥�

Meanwhile, Dennis Hone, finance director at Mace, has criticised the government鈥檚 interventions into apprenticeships and training.

Hone said the firm was now required to pay both the CITB Levy and the Apprenticeship Levy, which amounts to a charge of over 拢2m for the firm.

鈥淚n our view there should be some rationalisation and integration of these two schemes to simplify them and reduce what could be thought of as a tax on jobs,鈥� he added.