Before exceptional items, the firm delivered a £3.2m trading profit as strong project delivery and tight cost control boosted performance across its rail, bridges, energy and infrastructure divisions.

The non-cash impairment related to Spencer’s historic minority stake in Hull’s Energy Works plant, which was sold by its main investors.

The plant has suffered technical issues, reducing electricity output. Resolving these issues required significant additional investment which the main investors declined to provide. As a result, the plant was sold to a third party, substantially reducing the value of Spencer’s investment.

Spencer said the adjustment had no operational or cash impact on the business.

Cash generation remained strong, swinging from a £600,000 overdraft to a £4.5m year-end cash position.

Founder and executive chairman Charlie Spencer said: “The impairment is a one-off accounting adjustment with no cash consequence. Our operations remain profitable, cash-positive and well positioned for continued growth.”

Spencer group enters the new financial year with £83m of secured work and a £300m pipeline. It also achieved a 50% tender win rate and secured three national frameworks.