ISG slumps to a £27.8m loss

Grant Prior 9 years ago

ISG posted a loss of £27.8m today following a “painful restructuring of the UK Construction division”.

Problems at UK Construction have seen ISG’s Tonbridge office closed and the London luxury residential operation shut down.

Construction has also “recognised significant losses on a small number of projects that are now complete.”

ISG said: “In addition to the £18m of losses reported in the first half, the Group in the second half has made further provisions of £8.5m for London Exclusive Residential and £4.8m for Tonbridge.

“These covered unexpected cost overruns and delays on the remaining four live projects, unanticipated sub-contractor insolvencies and a mixed outcome of final account settlements and adjudication decisions.”

The extra provisions mean the Tonbridge closure has cost £15.8m and London residential £15.5m.

ISG bosses are confident their construction woes are behind them and staff numbers rose at the division to 898 from 838 despite the closures.

Chief executive David Lawther said: “It has been a challenging year for ISG, with the Group performance significantly impacted in the first half by the losses in our UK Construction division.

“We delivered a significantly stronger second half performance, with good results especially in our specialist fit out, engineering services and retail businesses.

“We believe that the poor performance and painful restructuring of the UK Construction division is now behind us, and with the outlook for most of our key markets remaining strong, we expect a much improved overall performance for the Group in the year ahead.”

Turnover for the year to June 30 2015 rose to £1,629m from £1,455m as losses hit £27.8m from a profit of £2.4m last time.

UK Fit out and engineering services made a £16m operating profit on turnover of £630m while UK retail made £9m from £320m of revenue.

UK Construction made an underlying operating loss of £18.1m.

Lawther said: “Looking ahead, the London office fit out market remains strong and, in the short-term, will be focused on medium-sized and refurbishment projects, whilst in the medium term, we will see larger-scale projects feature more prominently again.

“The UK’s economy is stable and we expect further opportunity in other major UK cities.

“With strengthened management, a simplified structure, a focus on repeat business and more favourable market conditions, a significant improvement in the performance of our UK Construction division is expected.

“Overall, we expect a much improved performance in the year ahead.”





Latest news

Plan lodged for tallest skyscraper outside London

Developer Salboy submits plan for 76-storey Manchester resi tower
5 hours ago

Curo starts £170m race for new homes framework

Bath housing association plans to build up to 300 homes a year
5 hours ago

Gove approves major Cambridge North mixed-use scheme

Government backs controversial scheme of 424 flats and 600,000 sq ft of tech and lab space
6 hours ago

Pontins holiday park to house Sizewell C builders

Suffolk holiday park to house 500 nuclear construction workers
6 hours ago

Adrian Bloor targets 1,000 homes-a-year

Expansion plans after major investment into challenger house building business HarperCrewe
5 hours ago

Housing firm fined £528,000 after cable strike

Maintenance workers given no information on underground services
6 hours ago

Berkeley subbies face six weeks without payments

Introduction of new finance software means payment hiatus for suppliers
1 day ago

Pagabo reveals 56 winners of latest £1.6bn retrofit deal

Decarbonisation Solutions Framework launched: Full list of winners
1 day ago

Go-ahead for £100m Liverpool Love Lane flats

500-flat scheme will be built across four blocks in Vauxhall area of city
1 day ago

Unions win HS2 site access battle at Old Oak Common job

Skanska, Costain, Strabag JV now the last denying unions access to HS2 sites
1 day ago

Contractors jack 1,100t viaduct into place in 13-hour operation

158m-long composite deck structure jacked into place 10-hours ahead of schedule
1 day ago

Wates wins former Daily Mail printworks transformation

British Land advances major cultural venue at London’s Canada Water
2 days ago

Mace poaches Ramboll chief to be Head of Engineering

Martin Feakes will develop civil and structural engineering offer at Mace
2 days ago

Subcontractors form alliance for major civils jobs

Trio of specialists join forces to collaborate and offer Tier 1 contractors a turnkey solution
2 days ago

Fear of supply chain failures boosting collaboration

Procurement survey also reveals project bank account use is rising
2 days ago

Wates sets up business to target 160,000 mouldy social homes

Healthy Homes service will be offered to social landlords across England
2 days ago

Higgins wins £75m Peabody Passive House job

Latest phase of Deptford Landings to start construction
2 days ago

Contractors and unions agree Sizewell C working deal

New deal offers improved sick pay and parental leave over Hinkley Point deal
3 days ago

Competition chiefs win legal fight for more construction raids

High Court rules CMA officials can raid a domestic property as part of investigation
3 days ago

More Osborne companies file administration notices

Three more divisions lodge notices with court
3 days ago

McLaren wins multi-storey urban logistics contract

South London win with British Land is pioneering urban logistics hub
3 days ago

Big social housing schemes at risk over funding uncertainty

Housing associations warn uncertainty over public funding beyond 2026 is curbing new schemes
3 days ago

Kier wins Worcestershire town centre renewal

Firm secures Bromsgrove commercial and cultural hub project
3 days ago

BAM signs Kent school contract at £42m

Sevenoaks school rebuild signed off at £8m more than first estimates
3 days ago

RG Group signs £121m Newcastle rental homes job

Developer Olympian Homes advances 519 flats plan at Pottery Lane site
6 days ago

Geoffrey Osborne files administration notice

Contractor in talks to save parts of the business
6 days ago

Winners named for £260m Manchester Uni framework

B&K, Henry Bros, Graham, Robertson and Vinci among new line-up
6 days ago

Shed specialist Benniman rides out market lull

Worcestershire warehouse builder says industrial and logistics work is picking up again
6 days ago

Another contractor cleared after high profile immigration raid

Adana Construction employees were working legally on site swooped on by Home Office
6 days ago

McAleer & Rushe wants to meet new London suppliers

Contractor holding Meet the Buyer event in London: Register now
6 days ago

Contractor services