Friday, August 21, 2009

T Clarke profits tumble as contractor implements restructuring plan

Electrical contractor T Clarke reported a sharp drop in first-half pre-tax profits after taking a ВЈ1.4m charge for its restructuring programme.

The London-based contractor, which said last month it was initiating a strategic review of the group and would not meet current market expectations for the year, saw pre-tax profit fall to ВЈ3.1m in the six month ended 30 June from ВЈ5.4m last time.

Revenue was also lower at ВЈ95.8m compared with ВЈ109.3m last time.

T Clarke’s restructuring programme involved big headcount reductions and the closure or disposal of two small regional businesses.

The group is currently winding down its operations in Altrincham to operate through its Preston business. It is also negotiating the sale of its Birmingham business.


T Clarke profits tumble as contractor implements restructuring plan


The largest staff cuts were at the core London operations where a number of office projects have completed or are near to completion. Revenue from the core London operations dropped 10.5% in the six months and operating margin was 3.7% after redundancy and other provisions of ВЈ0.9m.

The London forward order book is ВЈ100m, of which ВЈ35m is scheduled for completion this year.

Pat Stanborough, chief executive said: "This has been a tough six months for T. Clarke and we have not been immune from the recession. The Board has acted prudently in reducing overheads to align resource with current workload."

"Our order book remains strong, however, and enquiry levels are picking up especially in the regions. We have ВЈ170m of work in the group's pipeline, ВЈ75m of which is due for completion this year with ВЈ35m in London alone.

He added: "We are still winning new business around the country and we are on the tender list for a significant amount of future work."

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