FM giant says division is now profitable but restructuring costs and lost goodwill have hit hard
Facilities management giant Interserve will be forced to write off £30m in restructuring costs and lost goodwill relating to its specialist services division, the firm admitted today in a trading update.
It said market conditions continued to be challenging across the specialist services division, which was now profitable as a result of restructuring. “However, given the uncertain demand outlook in the markets served by this division the board has determined that it is appropriate to consider the carrying value of goodwill associated with these activities. As such, the 2009 income statement is expected to include a non-cash exceptional impairment charge of c. £30m,” it said.
The admission came as the firm revealed it had won a total of £350m of work since its interim management statement in November across a range of its sectors. These included a £70m contract with the Ministry of Justice to build a young offenders' institution at Glen Parva in Leicestershire and a £70m job for United Utilities to construct a storm water tunnel in Preston.
The company also said it had transmitted £61.5m worth of PFI assets into its pension fund in a bid to reduce the fund's deficit. The firm said it had a total future workload secured of £1.7bn for 2010.