Wednesday, November 11, 2009

North Midland Construction profits steady despite 30% fall in orders

North Midland Construction expects to meet profit forecasts for 2009 despite a 30% fall in revenues.

In trading up date, the contractor said contract dispute settlements on two flue gas desulphurisation projects and a Halifax job saw a ВЈ5.5m injection of cash into the business.

Chairman Robert Moyle said the business had experienced falling orders and tight margins but earlier action to cut overheads by 10% would keep the group on track to meet profit forecasts.

Moyle said that the current order book for 2010 stood at ВЈ64 million. Its AMP5 framework for Severn Trent Water and the South Yorkshire Digital contract would gave North Midland a stronmg platform of work for next year.


North Midland Construction profits steady despite 30% fall in orders


He added that North Midland was taking legal advice regarding an appeal against a ВЈ1.5m fine handed down by the OFT following its cover pricing probe.

The building business secured several new contracts, providing a workload for 2010 of ВЈ15m. Revenue at the division this year is expected to hit ВЈ14m with profitability down.

Nomenca is continuing to perform well and two new frameworks in the water industry have recently been won. Both forecasted revenue and profit will fall marginally below the previous year.

The highways division has recently been successful in bidding for several public sector contracts and a framework for Liverpool City Council. Both revenue and profit will be reduced from the previous year.

The utilities division is performing well and is experiencing increasing revenues, as the South Yorkshire Digital region contract is now fully underway. A profit in excess of the previous year will be delivered.


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