Firm adds cost of complying with new safety legislation hits bottom line
Bouygues said rising inflation following the war in Ukraine, availability of labour and the cost of complying with new industry legislation sent its UK business tumbling into the red last year.
In accounts signed off in March but only filed at Companies House this week, the firm said it racked up a £42m pre-tax loss in 2022 from an £835,000 profit last time.
The firm, which is working on the first phase of the HS2 railway in the Chilterns, the Hinkley Point C nuclear power station scheme in Somerset and a new eye hospital in London, said it had also been hit by “post completion liabilities arising from recent legislative changes relating to building safety”.
It added it had also been affected by several subcontractor failures on its jobs. “Cost forecasts were revised accordingly,” it said. Turnover last year fell 21% to £383m.
The firm said contract provisions at the end of last year totalled £5.3m from £4.3m last time which in a note it explained “relate to expected losses to completion on construction contracts in progress”.
A £1m restructuring cost was also made on top of 2021’s £1.1m restructuring cost, which Bouygues said “relates to further streamlining of the company’s business unit organisation”.
The firm has now reorganised into three business units in the UK, under a rejig which has seen chief executive Rob Bradley leave the business. Documents filed at Companies House show he went at the beginning of this month and has been replaced by chair and UK country director Fabienne Viala as chief executive.
Bouygues, which is part of the £39bn turnover French giant, said its cash position at the year-end was £174m.
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