20th Apr 2015 08:23
LONDON (Alliance News) - North Midland Construction PLC on Monday said its pretax loss narrowed in 2014, as higher revenue offset losses related to two contracts in its building and civil engineering division.
North Midland, which provides civil engineering, building, mechanical and electrical services, said its pretax loss for the year was GBP3 million, compared to a GBP5.9 million loss a year earlier, driven by continued losses on legacy contracts. Stripping out the effect of the legacy losses, the group's pretax profit was GBP4.4 million, compared to GBP3.8 million in 2013.
The legacy losses from the building and civil engineering divisions, on contracts the company secured at the height of the downturn, was GBP6.2 million in 2014, down from GPP9.6 million in 2013. North Midland attributed the losses to unforeseen further delays and cost overruns on two major contracts, but it said progress has been made on resolving a number of other legacy contracts.
Revenue rose to GBP193.2 million from GBP177.6 million, pushed higher by the performances of North Midland's highways and utilities businesses, and by robust revenue growth in its NMCNomenca and Nomenca subsidiaries. The performances in those businesses offset declining revenue in the building and civil engineering business, which remained beset by the legacy contract problems.
North Midland said its already secured workload for 2015 is GBP155 million and said 85% of group revenue will be derived from framework contracts going forward. It said it is still working on resolving the legacy contract issues, but said it is "cautiously optimistic" for the year ahead.
Shares in North Midland were up 2.9% to 124.00 pence on Monday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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