The firm said price-driven competition retained its grip on the M&E sector forcing some rivals to exit markets and many other competitors to bid below cost in order to keep going.

Despite margins remaining under intense pressure, T Clarke managed to raise the order book from £230m to £250m last year, according to 2013 results posted today.

Turnover rose 12% to £217m, driven by the south, which accounted for £173m, but struggled to deliver a pre-tax profit.

Across the group pre-tax profit edged up to £1.7m in 2013 from £1.2m the year before.

Mark Lawrence, group chief executive, warned the firm was struggling to receive full payment on a large unnamed job in the south, where the amount due includes £6.5m of uncertified applications.

The firm said: “T Clarke complied with its contractual obligations diligently and proactively, the principal contractor continues to frustrate the account settlement process.”

It also warned that the group is appealing a costs award against it and several other firms relating to a project dating back to 2007.

Costs, which are believed to be substantial, have yet to be apportioned between the various parties to the damages claim, and the £3.5m damages claim itself is subject to an appeal by the company’s insurers.

T Clarke said it believed there was a real prospect of the appeal proving successful.

Despite overhanging problems, Lawrence said the firm continued to build a platform for growth this year, after its expansion into Wales in 2013.

This year T Clarke plans to open an in-house design and build operation based in new premises in Colchester.