Thursday, June 25, 2009

Thomas Armstrong (Construction) suffers £950,000 loss

Thomas Armstrong (Construction) has dived into the red with a pre-tax loss of ВЈ950,000 on a turnover of ВЈ61m.

The figures cover the 12 months to 27 September 2008.

In the previous year there was a pre-tax profit of ВЈ2.3m on turnover running to ВЈ47m.

The group undertakes general building, civil engineering and industrial contracting.

The latest period was “very difficult” said the group.

In one division, Cumbria and North Lancashire, there was a full orderbook going into the new financial year and “this together with partnering and negotiated work enabled the area to report satisfactory results”.

By contrast, things were not well in the North Yorkshire operation where turnover fell “much lower” because Armstrong was unsuccessful in winning tenders for new work.


Thomas Armstrong (Construction) suffers £950,000 loss


As a result Armstrong bit the bullet, closed the area office and paid the cost of redundancies.

What with this redundancy spend plus the under-recovery of overheads as well as losses on poorly performing contracts, there was a total hit of ВЈ1.1m.

While all that was going on, Armstrong continued to develop its plumbing and heating department and this division secured contracts for central heating systems for local and regional housing associations.

During the year, Armstrong won a ВЈ41m contract for the retail and housing elements of the redevelopment of Penrith Town Centre.

Work commenced in June 2008 but then the developer unfortunately caved in and all work on the project ground to a halt in October.

That left applications for payment of ВЈ2.5m outstanding.

“Discussions have continued with the developer, Sainsbury and Eden District Council over the future of the project,” reports the group, adding that it has therefore provided for the sum of £2.5m in its latest annual results.