Tuesday, October 6, 2009

Mouchel makes a £13.5m loss and closes rail arm

Mouchel is withdrawing from UK rail contracting blaming the move on poor margins and missing out on Network Rail's civil engineering framework.

Losses connected with the rail withdrawl and collapse of the Dubai property market saw the infrastructure company unveil a pre-tax loss of  ВЈ13.5m in the year to July, after taking into account an exceptional cost of ВЈ53.6m.

But group turnover grew 13% to ВЈ740.6m with underlying profit also up 13% to ВЈ43.7m, helped by growing highways work.

Richard Cuthbert, chief executive, said: "This has been a difficult and disappointing year for Mouchel.

"In the second half we have had to deal with the substantial withdrawal from the rail market, together with the impact of the economic downturn on our Middle East and management consulting businesses.


Mouchel makes a £13.5m loss and closes rail arm


He added: "These have clouded what has otherwise been another year of growth and strong performance in our core business.

He said that pressure on public spending also brought opportunities for Mouchel as clients sought to drive efficiency by outsourcing more services.

"Our focus on the transformation of essential services and the maintenance of vital infrastructure means that we will continue to benefit from sustained levels of public expenditure in our core markets and from the inevitable trend for increased outsourcing, signs of which we are already seeing, said Cuthbert. 

Over the year staff numbers were cut by 2% to 11,100 due to the downturn in the MiddleEast and need to streamline overheads in the UK.

Cuthbert said Mouchel's bid win rate in the sceond half of the year had been restored to within its target range of between one-in-three and two-in-five of tenders by value.



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