Construction loss dampens Eric Wright profits

Aaron Morby 2 years ago
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Another year of losses at Eric Wright’s Construction arm dented the Lancashire group’s overall profits last year.

Jeremy Hartley, managing director of Eric Wright Group says demand has proved resilient so far this year
Jeremy Hartley, managing director of Eric Wright Group says demand has proved resilient so far this year

Eric Wright Group saw pre-tax profit fall by nearly a quarter to £7.7m despite revenue rising almost a third to £223m.

The rise in revenue last year was principally driven by greater activity in the civil engineering, water and construction businesses.

Gill Chadwick, Eric Wright Group finance director, said: “Although we have seen a drop in overall profit, underlying trading remained strong with improved profitability in a number of key divisions.

“While general economic conditions during 2019 continued to create challenges, the  stability afforded by our diversity and the strength of performance from our investment property portfolio provided us with substantial resilience and gives us confidence for the future, notwithstanding the unprecedented place we all found ourselves in as 2020 began to unfold.

“The property portfolio again performed well with a number of new lettings and positive rent reviews, contributing to an improved rent roll.”

But the construction division continued to face industry-wide challenges and completed two underperforming contracts which resulted in a loss, despite revenue rising to £106m (2018: £74.1m).

Construction ended the year with an order book in excess of £100m.

Eric Wright Civil Engineering returned to profit as a result of the board’s strategy to improve turnover levels through expanding the customer base and increasing average project size.

Eric Wright Water also saw an increase in turnover to £50m (2018: £42m), with profit before tax of £0.7m (2018: £0.2m) reflecting continued expansion of the businesses geographical reach.

Maple Grove Developments continued to make good progress developing commercial property across the North, with profit before tax up to £1.8m from £1.1m in 2018.

Jeremy Hartley, managing director of Eric Wright Group, said: “Given the unforeseen and far-reaching difficulties presented in 2020 by Covid-19, each division is faced with its own unique challenges as we trade into a very changed world.

“We are fortunate to operate in a number of sectors where the demand has proved resilient and we have a strong financial position which will support us as we adjust to the requirements of trading safely and successfully in the months ahead.”

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