Skanska UK takes £33m hit on projects

Aaron Morby 4 months ago
Share

Skanska has revealed a £70m raft of major project writedowns in both the UK and US in the second quarter of the year.

New UK business chief Gregor Craig is addressing project cost overruns

The UK operation, which went through a winning-streak of major projects wins in the capital as London was heating up, unveiled project writedowns of £33m.

Major project cost overruns were unveiled just two months after Skanska UK President and CEO Mike Putnam left the firm, handing over to Gregor Craig, who joined Skanska in 2003 as operations director at the London commercial building operation.

A spokesman for Skanska UK said: “The main reasons for the write downs are lower than anticipated production rates, projects being delayed with estimated penalties and multiple customer-driven changes, which have caused cost overruns.

“In these areas, we continue to have constructive dialogue with our customers to reach commercial agreement.”

“The executive management team, under the leadership of Gregor Craig is actively addressing the issues around these write downs.

“Skanska UK continues to maintain its strong balance sheet and cash position.”

Skanska revealed that it aimed to cuts overheads to reduce the impact of cost overruns on the business.

It said many of the problem projects were close to completion with others running into 2018.

Announcing trading for the second quarter, the group also revealled writedowns of nearly £40m at its US business.

Here the civil engineering operations project write downs are mainly due to not achieving estimated production rates.

To reduce organisational costs and restore profitability, the US civil operations will focus on its core geographies and product lines going forward.

After the write downs, Skanska Group’s operating income for the first six months of 2017 was expected to be around £305m (£332m)

 

Latest news

Carillion warns on profits again as it breaches banking covenants

Contractor asks for more time from lenders as debts set to soar up to £925m
24 hours ago

T Clarke powers ahead on London major project wins

M&E specialist boasts strong orders for next two years despite Brexit fears
23 hours ago

Kier wins £35m Clydebank hospital project

Kier to start work early next year on first of two treatment centres for Golden Jubilee hospital
23 hours ago

M&E specialists suffering from blight of retentions

Nearly a third of firms have up to 10% of their turnover locked-up in retentions
23 hours ago

15 councils face action over local housing plans

Government set to intervene to force through local housebuilding plans
2 days ago

Betting Spy: Winning start for the Moyes boys?

West Ham are worth a go at 5/2 to turn up for their new boss
1 day ago

North to get own transport spending powers

Plan to give Transport for the North statutory powers from April a game-changer
2 days ago

White collar skills crisis strangling construction

Nearly two thirds of companies can't find Quantity Surveyors
2 days ago

Winvic bags £40m Nottingham build to rent scheme

Construction to start this month on 350-home scheme
2 days ago

Government rethink over £130m Balfour lorry park

Current plans dropped as Highways England goes back to the drawing board
2 days ago

Green light for £270m Swindon leisure complex

Work to start next year on North Star ski centre, hotel and cinema complex
2 days ago

£60m+ offsite secondary school bundle out to bid

ESFA plans trio of £20m-plus secondary schools projects using modular construction
2 days ago

British Land to start £200m London office revamp

Regent's Place office to be enlarged in major revamp near Euston
2 days ago

Hunt starts for £50m Liverpool cruise terminal builder

Preferred bidders will be revealed in March
2 days ago

Boost your online presence with the new Enquirer Directory

New site for suppliers and buyers will showcase their products, services and latest stories
3 weeks ago

CITB to cut costs by stopping training

Skills body to "exit direct delivery of training through the National Construction College"
2 days ago

£17.5m Fylde coastal defence scheme awarded

VBA joint venture to start work in January on Lytham St Annes scheme
2 days ago

Interserve staff braced for more redundancies

Another wave of job cuts set to follow initial 200 lay-offs
3 days ago

£1.4bn Croydon Westfield shopping centre approved

Demolition contractors will be on the site for a year
3 days ago

Demolition to start for £250m Liverpool triple towers

Builder to be named for first residential tower in early 2018
3 days ago

Great Portland Estates plans work on £233m trio of schemes

Developer says London market still healthy
3 days ago

Three-year demolition job starts on Sellafield chimney

Painstaking work will see demolition team bring down 650 tonne stack by hand: Video
3 days ago

Mace wins £90m Harwell research project duo

Health research and satellite testing facilities to be built over three years
4 days ago

Crown Estate awards Kier £36m Regent Street job

Morley House will be demolished to make way for shops and flats
3 days ago

Over 30 firms land £8bn schools framework – Full list

Kier, Bowmer & Kirkland and Keepmoat take largest haul of lots
4 days ago

London facing post Brexit construction skills crisis

30% of construction workers in capital are from EU countries
4 days ago

Wates names interim financial chief

Veteran Rod Holdsworth takes temporary role while replacement found for Andrew Davies
4 days ago

Fire chiefs slam “lack of competence” in construction

Industry warned it needs to take fire safety more seriously
5 days ago

Intelligent JCBs set to save fuel and cut emissions

New software means machines will automatically switch off when power not required
4 days ago

£110m Glasgow shopping store to homes scheme approved

Mace is project manager for biggest city centre scheme since 1990s
4 days ago

Contractor services