Interserve makes £111m loss and spends £76m on refinancing fees

Grant Prior 6 months ago
Share

Interserve racked up another £111.5m in pre-tax losses last year.

Results posted today by the beleaguered contractor show an improvement on 2017 when losses hit £244.4m.

Interserve also revealed further details of its proposed deleveraging deal with financiers which will be voted on by shareholders next month.

Turnover at the group fell 10.7% for the year to December 31 2018 to £2,904m due to a drop in UK construction activity and tighter bidding criteria.

Net debt increased to £631.2m from £502.6m due to problem contracts in UK construction and the Middle East.

The increase will be made up with £110m from bankers as part of the deleveraging plan which shareholders will vote on on March 15.

Interserve said:  If the Deleveraging Plan is not passed on 15 March 2019, the Group will have an immediate working capital shortfall, regardless of whether the Lenders have demanded the repayment of the Group’s borrowings under the Existing Cash Financing Arrangements.

“The Group remains over-leveraged and the successful implementation of the Deleveraging Plan is critical to our future.”

Interserve also confirmed it spent £43m on fees for advisers last year during refinancing talks and that is set to increase by another £33m this year.

It said: “Professional fees incurred in connection with our refinancing totalled £43.0 million during the year. We anticipate that we will incur a further circa £33 million of fees in connection with the Deleveraging plan.”

The firm made another £12.6m in losses on problem Energy from Waste contracts bringing the total up to £229.2m.

Equipment Services arm RMD Kwikform has been the star performer at Interserve but even that division suffered a drop in profits.

Operating profits for 2018 were down 27% to £39.6m as turnover dropped to £195.5m from £229m.

UK construction turnover fell to £756.6m from £972.8m and delivered an operating profit of £2.2m compared to a £10.3m loss last time.

Debbie White, Chief Executive Officer, Interserve said: “Interserve remains focused on positioning the Group for long-term, sustainable success.

“This means continuing the operational progress we are making to put legacy issues behind us.

“However, the Group remains over-leveraged and the successful implementation of the Deleveraging Plan is critical to our future, as it will ensure that Interserve has a competitive financial structure for its future growth. I would urge our shareholders to vote in favour of the Deleveraging Plan.”

 

Latest news

VolkerWessels UK on track to top £1bn turnover

Group margin hits 3% as UK business enjoys record order book of £1.4bn
1 day ago

Lendlease unveils new construction boss

Company veteran Simon Gorski takes over from Neil Martin
23 hours ago

Kier to start work on £50m new home for Durham council

Contractor promises major boost to local supply chain
23 hours ago

Willmott Dixon to complete Pochin Stoke site

Replacement found for collapsed contractor on £37.5m scheme
1 day ago

Britain’s oldest building company strikes deal with creditors

R Durtnell agrees debt repayment plan with suppliers owed more than £8m
1 day ago

Worker jailed for tax dodging on major London sites

Self-employed Bournemouth builder sentenced to 30 months for evading £110,000 in tax
2 days ago

Bid race starts for £40m M1-A6 link road

Central Bedfordshire Council says project could start in March 2020
1 day ago

Castle Building Services bags £6m M&E package

Early appointment by Bowmer & Kirkland alllows plenty of pre-site start design time
1 day ago

Bright ideas from Balfour Beatty staff save £4m

"My Contribution" programme sees staff suggest 2,600 ways to improve efficiency
2 days ago

Boost your online presence – join the Enquirer Directory

Site for suppliers and buyers showcases products, services and latest stories
1 year ago

£120m plan to replace Liverpool flyover with tunnel

Plan lodged to demolish flyover and replace it with a dual-lane tunnel
2 days ago

B&K checks in with Manchester “Jenga” hotel

Work to start next month on 275-bed Piccadilly Station hotel
2 days ago

Radisson backs £5bn Kent theme park with hotel plan

Hotel giant takes stake in project as backers look to confirm construction start date
3 days ago

Super safe scaffold screen could slash site costs

System in use at Twickenham station site boosts safety and saves money
2 days ago

McMullen lands cladding package at King’s Cross

Specialist to deliver striking facade for main contractor BAM
2 days ago

Balfour results can help “restore confidence” in construction

Boss Leo Quinn says latest numbers show contractors can deliver
3 days ago

HS2 relaunches race for £300m tunnels fit-out

Latest plan for M&E and ventilation bid race to be detailed at London industry day next month
3 days ago

Midas Group struggles to raise margin above 0.25%

Regional builder rejigs operation to restore golden touch
3 days ago

Polish steel entrepreneur buys Builders Beams

Steelo swoops to save 45 jobs at fabricator
4 days ago

Spanish contractor seals £180m Aberdeen waste plant job

Acciona Infrastructure will deliver full turnkey package on Ness Energy Project
3 days ago

Kier and Interserve secure £100m NHS framework places

North East NHS Trust picks trio of firms for estate improvement programme
3 days ago

Workers given mental health monitors to wear

Spencer staff hit blue button on wristband when they are feeling anxious
4 days ago

Contractors advice wanted on £400m concrete road renewal deal

Highways England wants to talk to potential bidders about procuring resurfacing framework
4 days ago

Silvertown Tunnel award suspended after challenge by losing bidder

Transport for London forced to suspend summer contract confirmation after legal action
5 days ago

Colas UK targets growth after trading loss

Colas chief sets out business turnaround plan to double in size
4 days ago

Interserve fit-out boss joins Morgan Lovell

Matt Bray takes head of contracts role at Morgan Sindall office fit-out firm
4 days ago

Subcontractors wanted for £400m Dounreay decommissioning

Framework contractors to host suppliers day next month: Register now
4 days ago

Henry Boot buys social housing contractor

Sheffield developer and contractor buys controlling stake in Starfish Commercial
4 days ago

Caledonian lands £10m modular student digs deal

Offsite specialist will help cut build times by half at Hereford scheme
4 days ago

Money owed to Lakehouse creditors leaps to £27m

Investigations continue into controversial collapse
5 days ago

Contractor services