More problem contracts to push nmcn losses to £22m

Grant Prior 3 years ago
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Civils contractor nmcn is now expecting pre-tax losses for 2020 to hit £22m after more contract problems have been  unearthed.

It is the third increase announced to the Stock Market from £15m last October to £16.5m in December and now £22m.

The company said: “Following our announcement of 23 December 2020, additional costs on two major contracts within the Water division, have been identified which the Board believes could aggregate on a prudent basis to a further £5.0 million of losses in FY 2020.

“A significant proportion of these losses are attributable to Covid-19 and programme delivery delays, as well as costs associated with process commissioning and handover.

As a consequence of these developments, the Group is now likely to report losses before tax of up to £22 million for the year ending 31 December 2020.  In cash terms there will be a limited short-term impact given that the extra costs will be spread over a period of 28 months.

Subject to the approval of a resolution to extend the borrowing limit within the Company’s articles at the General Meeting on the 26 February 2021, the Company expects to complete on a medium-term financing package secured against its property development projects shortly thereafter. 

“The Board will continue to work with Arrowpoint Advisory to determine a longer-term financing structure in the coming months.”

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