London-firm spends £2m to settle “challenging contract”
Gratte Brothers has more than doubled its pre-tax profit despite a drop in turnover.
The engineering and building services firm, in its accounts for the year to 31 March, reported turnover of £242.4m, down from £262.2m the previous year.
The London-based firm said the decrease in income was “primarily due to the phasing of projects”.
Despite the drop in income, the contractor increased its pre-tax profit by around £2.5m to £4.4m. The turnover decrease was more than offset by a £23m reduction in its spend on raw materials and consumables.
Its operating profit rose from £1m to £2.6m and its operating margin rose from 0.4% to 1.1%.
Gratte said its performance in the year was impacted by a £2m provision to settle a “particular challenging contract” which had led to “unforeseen cost increases and delays”.
It said the completion of the project “removed a long-standing constraint on future performance”.
The group’s turnover from electrical and mechanical engineering, which makes up more than 80% of its income, dropped from £225.9m to £199.3m, but it increased its building service projects and maintenance workload by £6.8m.
Gratte Brothers was placed 79th in Building’s annual Top 150 Contractors and Housebuilders List out earlier this month.
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