18th Jan 2017 08:07
LONDON (Alliance News) - Facilities management and outsourcing firm Mitie Group PLC on Wednesday said it has booked further one-off charges on the contracts on its books, a move which will take another lump out of the firm's profit for its current financial year.
Mitie issued a profit warning in September, hit by less high-margin work for its facilities management business and by the impact of a local authority budget squeeze on its units handling maintenance work and homecare services for local councils.
This pushed the group to a pretax loss in the first half to the end of September.
Since then, the group said its board has met to consider the trading outlook for the remainder of the year to the end of March. Its Property Management and Technical Facilities Management divisions have been hit by client deferrals and investment plan delays, meaning some work for these units will be pushed into Mitie's 2018 financial year.
It is also clear, Mitie said, that its Cleaning division is underperforming, and so it is implementing changes to the management team at this unit to try to turn it around.
Mitie also said it will book a further GBP14.0 million charge for the year to March 31 after taking a more "conservative" view on some of the contracts on its books.
As such, underlying operating profit for the year to March 31 will be between GBP60.0 million and GBP70.0 million, down from GBP128.9 million a year before.
Separately on Wednesday, Mitie said Finance Director Suzanne Baxter will leave her role on February 10, after having requested her role be considered as part of a succession planning review Mitie started a year ago.
She will be replaced by Sandip Mahajan, the former finance director at construction and infrastructure group Balfour Beatty PLC, who joins immediately before then taking up the position when Baxter departs.
By Sam Unsted; [email protected]; @SamUAtAlliance
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