Tribal makes pre-tax loss of £200,000 after reorganisation but says new structure will enable it to win bigger contracts.

Tribal has made a pre-tax lost of £200,000 for the year ended 31 March 2005. The public sector consultant said that it had been a challenging year where operating margins had been eroded by the need for organisational change.

In its consulting arm, which represented £55m of the £229m turnover, the public sector consultant said that the operating profit was down 6%. It said the fall was a consequence of organisational restructure, more competition and during the first half of the year, higher costs due to skill shortages.

In its property division the acquisition of Derek Hicks and Thew helped increase revenue by 16% to £21.3m but operating profit fell. Tribal said this was a consequence of the investment made in extending geographic coverage and the development of capital spending programmes.

The start up business Mercury Health won a £214m contract with the NHS to design, build and staff a regional network of treatment centres. Tribal said it expected to pick up more contracts from the government, which is planning to announce projects worth £4bn over the next five years.

Profit before tax excluding goodwill amortisation, impairment, and other exceptional items was £17.9m, which represented a fall of 11% from the previous year.

Chief executive Henry J Pitman said: “We have now completed our organisational restructuring and are well-advanced in our integration process.”

“W have won several major contracts which demonstrate the potential of the Tribal business model.