Contractor Sir Robert McAlpine has posted a made a pre-tax loss of £52.2m for the year to 31 October 2015.
The building and civil engineering company revealed the pre-tax loss for the year to October 2015, taking its loss over the last two financial years to more than £100m. Group turnover during the year, including share of joint ventures, was down to £782m from just over £1bn in 2014.
McAlpine said the “financial situation had deteriorated” on a number of jobs which caused a £54.8m loss in 2014, adding that the worst performing had “now reached practical completion”.
In his report,Tony Aikenhead, chief executive, said: “During 2014 the group identified a small number of construction contracts which had been tendered and started during the recession where significant costs were being incurred and considerable losses were expected.
“Although a prudent view of the final outcome of those contracts was made last year, the financial position has deteriorated further as the completion dates have extended by more than expected and costs have also consequently increased. Of these contracts, the worst performing have now reached practical completion and most are very close to completion.”
The losses prompted McAlpine to revise its risk management and tendering procedures which have led to improved margins on contracts.
The contractor said: “We are confident, therefore, that the construction business will return to profit in 2016.”
McAlpine is also putting extra resources into its infrastructure business which is expected to account for 20% of turnover by 2019.
