Division posts results after boss Ray O’Rourke revealed £246m overall loss
Laing O’Rourke has revealed a £141.3m pre-tax loss at its UK construction business, as detailed accounts for the divison became available at Companies House.
Laing O’Rourke Construction Limited said a £26.6m writedown on three projects won in 2013 in “a particularly aggressive price-driven market” and built through its offsite factory in the Midlands - Design for Manufacture and Assembly (pictured) - had contributed to the loss. Revenue edged up to £1.11bn, up from £1.02bn.
The results for the division to March last year come ahead of Laing O’Rourke PLC posting results for the overall global business for this period.
Last month the firm’s chief executive and founder Ray O’Rourke revealed the group had posted a £246m loss. The group results will be available in the coming days.
In his letter to clients and staff last month, O’Rourke said the £3bn-turnover contractor was having to report the major loss due to the impact of several problem jobs - including huge losses on a Canadian PFI hospital job, as revealed by Building last November.
He added: “We all know that when recession starts, our industry in particular enters a race to the bottom – regrettably Laing O’Rourke joined in.”
O’Rourke wrote that the firm has taken steps to turn around its performance and was set to return to profit in the current financial year to March 2017.
He also set out plans for the firm to become a £4bn-turnover business within four years and restated the firm’s commitment to investing in off-site manufacturing.
He made no mention of the contractor’s planned sale of its £1.5bn-turnover Australian business - a process the firm kickstarted back in January this year but has since gone quiet - instead opting to highlight that the division “has continued to perform well”.
He added: “In making this announcement, I want to assure all our stakeholders that our company is adequately financed, has returned to profit in FY17 and is therefore well-positioned to move forward from these less than satisfactory results”.