Firm says issue helped send profit slumping more than 60% last year
Willmott Dixon has again been forced to make a provision of more than 拢5m to carry out possible repair work on cladding following the Grenfell Tower fire four years ago, taking the amount it is having to fork out on the issue to more than 拢11m.
In its 2020 accounts filed at Companies House, the firm said it was adding another 拢5.4m to the 拢6.2m it set aside to fix the problem in 2019.
The firm said the figure related to the 鈥渆volving and increasingly complex issue of cladding and fire protection to previously completed buildings鈥�.
It added that 鈥渁 natural desire to 鈥榙raw a line鈥� under the financial uncertainty [has] led us to conclude upon the need to increase our previous provision by an additional 拢5.4m鈥�.
The firm said almost all of the work under scrutiny had been carried out by WPHV, a subsidiary housing business which went into administration just before Christmas last year.
It said it has so far spent 拢1.3m of the 拢11.6m it has set aside, leaving a remaining amount at the year end of 拢10.3m.
The accounts said Willmott Dion planned to 鈥渨here appropriate鈥� settle a 拢7.9m bill with creditors of WPHV, which was formerly known as Willmott Dixon Partnership Homes.
The business was previously Willmott Dixon鈥檚 primary residential arm and delivered several projects for local authorities and housing associations. But the firm stopped taking on new business in the 2017/18 financial year and was put into administration on 22 December.
Willmott Dixon said the provision and the impact of the covid-19 pandemic helped send pre-tax profit slumping two-thirds last year to 拢9.8m on turnover down 4% to 拢1.2bn.
The firm was handed 拢5.7m in furlough money from the government鈥檚 Coronavirus Job Retention Scheme after putting around 800 people on the initiative last spring.
Willmott Dixon did not pay a dividend last year and chairman Colin Enticknap said it claimed the furlough money 鈥済ratefully and unapologetically鈥� 鈥� thought to be a reference to the practice of some firms paying shareholder dividends while hanging on to furlough cash.
Turnover at its biggest business, construction, stayed flat at just over 拢1bn but work at its interiors business was up 12% to 拢167m with the firm winning jobs at CBRE鈥檚 Brindley Place scheme in Birmingham and a job at Gresham Street in the City of London.
The firm said future prospects depended on government responses to new strains of covid-19 as well as to what extent public spending programmes would be affected by the huge cost of dealing with the pandemic with, according to the office for Budget Responsibility, the amount borrowed in the year to April 2021 standing at 拢355bn 鈥� the highest ever figure seen outside wartime.
Willmott Dixon鈥檚 cash at the bank rose to 拢98.8m from 拢93.1m in 2019, it added. It said its order pipeline stood at 拢1.35bn.
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