Galliford Try to raise £150m to cover Aberdeen Bypass

Aaron Morby 10 months ago
Share

Galliford Try is being forced to raise £150m to pay for big cost overruns on the Aberdeen Western Peripheral Route and a £40m hit following the collapse of joint venture partner Carillion.

Progress on the 270m-long Dee crossing at Milltimber

The firm this morning said it planned to raise the cash from investors in a fully underwritten share issue to meet cash commitments on the project of more than £150m.

Peter Truscott, chief executive, said Galliford Try continued to make good progress in resolving both AWPR, where it expects to complete construction during the summer, and other legacy contracts. 

He added that construction division would no longer undertake fixed price, all risk major projects of this nature, and had improved its tendering and project selection processes.

The firm said it had sufficient financial resources to meet its obligations, but this would involve diverting capital away from the growing Linden Homes and Partnerships & Regeneration businesses.

In early City trading shares tumbled 19% to 799p on news of the fund raising plan.

In the half-year results to 31 December 2017, reported this morning, Galliford Try delivered a pre-tax profit of £56m, despite recording a £18m loss at the construction division.

Excluding the £25m exceptional hit from meeting Carillion’s commitment on the Aberdeen Bypass, construction delivered a £7.2m profit.

This saw underlying construction margin improve to 0.9% from 0.4% a year ago.

Construction’s cash balance of £45m was lower than the prior year figure of £111m due to the legacy contract issues.

These losses were offset by strong profits at Linden Homes and the Partnership Housing business, which continues to grow strongly.

Overall Gallford Try delivered a 11% rise in pre-tax profit on revenue up 14% to £1.5bn.

Gallford Try trading by division in first-half
Profit (H1 2017) Pre-tax profit (H1 2016) Revenue H1 2017 Revenue (H1 2016)
Construction £18m loss £2.7m £824m £742m
Partnership Housing £10.8m £4.9m £223m £144m
Linden Homes £81m £74m £437m £408m

 

Truscott added: “We continue to maintain strict control over net debt, which is consequently better than our guided level.

“We enter the second half of the year with a solid foundation to build on and strong fundamentals for the housing market.

While we remain cautious of the impact of the current political uncertainty and the medium-term outlook for the macro economy, we believe our focused strategy, strong order book and disciplined approach will deliver further growth and shareholder value.”

 

 

Latest news

Crossrail delayed again as costs rise by another £2bn

Mayor attacks previous management team who insisted project was "on time and on budget"
2 mins ago

Interserve shares collapse as rescue talks continue

Shares slump to all-time low as firm now worth under £13m
14 hours ago

Ian Lawson to advise McLaren on growth plans

Former Severfield and Kier boss becomes consultant at expanding contractor
4 hours ago

Forrest falls into administration

Construction and housing divisions to cease trading while Engie buys refurb and energy contracts
3 days ago

Wates chief draws up first best behaviour code for private firms

Wates Principles to raise corporate governance standards at private firms
6 hours ago

Plan for Bristol Finzels Reach £140m phase 2

Former Avon Fire and Rescue HQ to be transformed with 300 homes and offices
6 hours ago

Labour calls for public contract bidding ban on Interserve

Shadow minister demands action to protect taxpayers
6 hours ago

£750m East of England framework out for rebid

Construction work to be broken into four project value bands
6 hours ago

Lakehouse staff let go as subcontractors quit sites

Workers made redundant and suppliers leaving sites just months after sale
3 days ago

Boost your online presence – join the Enquirer Directory

New site for suppliers and buyers showcases products, services and latest stories
7 months ago

Kier scores November contracts league double

£300m London luxury flats project extends Kier's lead at top of annualised league
3 days ago

Green light for £300m Norwich mixed used scheme

Weston Homes to build 1.2m sq ft scheme creating a "Covent Garden" style urban quarter
3 days ago

Former Kier boss joins McCarthy & Stone

Nigel Turner to lead drive to reduce construction costs
3 days ago

Vermont replaces Forrest on £100m Liverpool site

Elliot Group moves quickly to secure new main contractor as existing site team taken on
4 days ago

Bristol contractor goes into administration

Majority of 50-strong workforce at Helm Construction made redundant
4 days ago

Kier drops out of FTSE 250 as share price dives

Shares trade below discounted rights issue price
4 days ago

Betting Spy: No Arnie no problem for West Ham

West Ham and Man City to land 3/1 double
4 days ago

36-hour Hinkley Point concrete pour releases £70m

BYLOR achieves key concrete raft milestone in 2,500 cu m pour
4 days ago

Murphy major projects chief joins Galliford Try

Sean Blackmore to lead expansion in the rail market
4 days ago

Multiplex Europe MD shifts to non-exec role

Ross Ballingall moves on after eight years heading construction business
4 days ago

MPs demand end to late payment and retentions reform

Hard-hitting select committee report demands end to cash "stranglehold" imposed by big firms
5 days ago

Network Rail awards first CP6 contracts

Story Contracting and AmcoGiffen win Scotland North East building and structures renewals
5 days ago

Former Atkins chairman replaces Terry Morgan at HS2

Allan Cook takes reins at HS2 while hunt starts for Crossrail chairman
5 days ago

Construction aims to attract more ex-offenders

Construction firms sign-up to major new training drive to plug skills gap
4 days ago

Proline Group hit by fall-out from Forrest

Building services specialist fights for survival after bills go unpaid by main contractor
5 days ago

Hunt for smart motorway trio to deliver £7bn plan

Highways England starts hunt for smart motorway alliance partners
5 days ago

VolkerFitzpatrick wins £20m combat systems hub

Work to start on Portsmouth defence systems academy early next year
5 days ago

Fusion21 starts hunt for £800m building framework partners

Firms have until end of January to complete early bid submissions
5 days ago

Flying concrete from blocked pump kills worker

Specialist contractor and director fined after worker dies two months after joining firm
5 days ago

Peel plans five resi towers at MediaCityUK

Michigan Avenue scheme will boast MediaCity's tallest tower
5 days ago

Contractor services