Firm counts cost of sites shutting during early weeks of pandemic
Profit at Lendlease’s Europe arm fell to just £157,000 last year as the firm said the impact of covid-19 on its biggest division hit its bottom line.
The firm said construction was affected by the pandemic shutting work on its sites, which include the new Google headquarters building at King’s Cross.
The job became the first major UK site to be hit by an outbreak of coronavirus last March and was shut down for a few days before being reopened.
But it was shut again – along with the rest of Google’s jobs worldwide – when the crisis escalated later that month with work eventually stopping for more than two months.
Lendlease said the cost of dealing with covid, including drawing up new site operating procedures, as well as delays in new contract awards helped send pre-tax profit in the year to June 2020 nosediving to £157,000 from £8.8m.
Revenue from construction was up 19% to £440m with overall revenue at the group also up from £673m to £832.5m.
The firm said £632m of its revenue was from its construction, development and investment arms with development, which includes its Thamesmead joint venture in south-east London with Peabody, seeing a rise of 21% to £190m.
It booked a further £193.5m in income from the sale of residential units from its development portfolio which includes its scheme at Elephant Park in south London.
The bulk of work at its Europe arm comes from the UK although it has a handful of schemes in Italy including a mixed-use scheme called Milano Santa Giulia. Around 90 of the firm’s 1,400 staff are based in Italy.
Last month, Lendlease, which is listed on the Sydney Stock Exchange, said group revenue slumped 30% to A$5.2bn (£2.9bn) in the six months to December 2020 with post-tax profit off by 37% to A$196m (£110m). The firm blamed the impact of covid-19 for the falls.