Mears chases £2bn bid pipeline after profits weaken

Aaron Morby 9 months ago
Share

Housing maintenance and care home specialist Mears saw profits and revenue slide after a challenging year caused by a hiatus in planned maintenance work in the wake of the Grenfell disaster.

CEO David Miles is confident about the year ahead

The firm also blamed aggressive pricing from competitors for a slowdown in securing new contracts, which it had expected to make up the shortfall in ongoing activity with clients.

Overall group revenue slipped 4% to £900m with pre-tax profit from ongoing operations also down 10% to £26.5m, as housing maintenance operating margins slipped from 5.6% to 5.2%.

The group’s full pre-tax profits slumped to £8.8m after Mears took a hit of £16.5m from offloading its mechanical and electrical division, which included a legacy issues from a business operating in the United Arab Emirates. The exceptional write-off covers liabilities from performance guarantees as contracts reach completion.

David Miles, Chief Executive Officer of Mears, said that the tragic events of Grenfell Tower caused unforeseen delays in the timing of  planned workload as clients’ attention was diverted towards ensuring that their housing portfolios were safe and fully compliant. 

He said: “While 2017 proved to be a challenging year, we have made solid operational progress.

“The decline in housing revenues following the tragic events at Grenfell Tower has stabilised although there still remains some uncertainty as to the speed at which these revenues will recover.

“The performance of the Care division has been a highlight, returning to profitability as planned following a period of restructuring, putting the Care division on a stable footing.”

Miles added: “On a positive note, the current pipeline of opportunities for Mears has never been greater.

“We anticipate competitively bidding contract values in excess of £2bn during the course of 2018.”

He added that Mears would continue to focus on bidding only at sustainable pricing levels but was confident of major project wins based on its 33% bid conversion rate.

Miles said: “The strategic evolution of our business means we are gaining access to opportunities that previously would have been out of our reach.

“While the board has decided to adopt a more conservative approach in how it guides the market on its expectations, the Mears operation is performing very well and I am encouraged that our excellent service delivery is putting us in a good position to secure new opportunities.

 

Latest news

Balfour Beatty delivers 2-3% construction margin goal

Leo Quinn hits phase two target of Build to Last turnaround plan
20 hours ago

Firms admit price-fixing of concrete drainage products

Precast firms took part in cartel for seven years
2 days ago

£300m Edgbaston mixed-use scheme advances

Phase one office project edges closer at New Garden Square regen scheme
20 hours ago

All JCB staff get £1000 Christmas bonus

Over 7,000 staff earn biggest Christmas bonus in a decade
19 hours ago

Robertson appoints Morgan Sindall director

Scott Wilson is now Robertson's business development director
2 days ago

Beeston leisure centre out to bid

Bidding starts on cinema project in £30m shops and 130 homes scheme
2 days ago

Scape MD to head Perfect Circle consortium

Victoria Bambini to lead AECOM, Pick Everard and Gleeds joint venture
2 days ago

EastEnders set rebuild soars £27m over budget

NAO slams BBC for planning failures and procurement delays
2 days ago

Spurs stadium delays continue into New Year

Man Utd match will be played at Wembley next month as contractors work through Christmas
2 days ago

Speedy buys construction training business for £9m

Plant hirer buys Glasgow-based Geason in construction training push
2 days ago

Summer start for £25m Carlisle flood defence plan

Flood defence plan to be revealed three years after storm Desmond hit
2 days ago

Amco wins Dunbar railway station upgrade

Work to start next summer on new platform and footbridge
2 days ago

Architects win post-Brexit talent deal

Designers win concessions but construction still in skills turmoil
3 days ago

Boost your online presence – join the Enquirer Directory

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

Essex contractor collapses after posting record results

Bolt and Heeks Ltd in administratron with 55 job losses
3 days ago

Science park starts contractor hunt for £12m office scheme

Construction work up for grabs on trio of buildings near Liverpool
3 days ago

Hitachi to pull out of £14bn Anglesey nuclear power plant

Hitachi plans for Anglesey nuclear power plant now in doubt
3 days ago

M&E specialist Ameon replaces Imtech on Graham site

Subcontractor steps in to keep project on track
3 days ago

Marshalls to buy rival concrete brick maker

Marshalls to buy Edenhall for up to £17m
3 days ago

Argent gets go-ahead for major Tottenham Hale revamp

Contractor hunt to start soon with construction set to start next summer
4 days ago

Drylining boss banned for tax dodging

Insolvency Service investigators uncover huge CIS and VAT payment discrepancies
4 days ago

£2bn Elephant & Castle shopping centre scheme final go-ahead

Demolition to start after London mayor nods through vast scheme
4 days ago

Modular building specialist goes into administration

Timber accommodation pod maker Carbon Dynamic runs out of cash on major contract
4 days ago

Structural engineer crushed under scaffold tubes

Housing giant and scaffold contractor fined a total of £180,000
4 days ago

Consultant MHBC merges with Cumming

City of London based firm now part of global giant
4 days ago

Crossrail delayed again as costs rise by another £2bn

Mayor attacks previous management team who insisted project was "on time and on budget"
5 days ago

Top housing association hires Lendlease resi chief

Richard Cook will lead Clarion Group's ambitious development plans
5 days ago

UK’s tallest Premier Inn plan in Docklands

Premier Inn books in at 30-storey mixed resi and hotel scheme
4 days ago

Kier wins £45m Cambridge schools campus phase one

Northstowe education campus includes a new 1,800 pupil secondary
4 days ago

Ian Lawson to advise McLaren on growth plans

Former Severfield and Kier boss becomes consultant at expanding contractor
5 days ago

Contractor services