Chief executive outlines strategy to deal with contractor鈥檚 拢48m writedown and regime change

Murray Coleman, Bovis Lend Lease鈥檚 UK chief executive, this week outlined a two-year recovery strategy for the troubled firm after its British and Europe operations suffered a 拢40m loss.

The loss was caused by a 拢48m writedown, announced last month, which in turn was attributed principally to the Manchester joint hospitals PFI scheme and the Bridgewater Place development in Leeds. Coleman revealed that the writedown also included provisions on other projects. He said profit growth would be suppressed for up to two years and that he is looking to recruit staff 鈥渇rom executive level through to unskilled labour鈥� to promote the firm鈥檚 recovery.

Lend Lease, Bovis鈥� Australian parent, this week posted a profit after tax of 拢68m 鈥� a 19% drop on last year鈥檚 拢83m. The global construction business made a 拢4.7m loss, largely owing to the UK writedown. Its UK and Europe PFI business made 拢7.1m profit.

Bob Johnston, Bovis鈥� global chief executive, implicitly blamed the loss on Jason Millett鈥檚 stewardship, claiming that the company had taken on 鈥渉igh-risk projects it didn鈥檛 understand鈥�. He said the situation had improved with its new management team.

But in an interview with 好色先生TV, Millett, Bovis鈥� former chief executive, accused the company of 鈥渞einventing history鈥�. He said: 鈥淏ovis鈥� position today is not just about the last two or three years.鈥�

Coleman appeared to agree with Johnston. He said: 鈥淥ne of the reasons I was brought over last summer was to position the business for the future and develop the level of transparency across operations.鈥�

He added that it would take the company time to work through its problems. He did not rule out a change in the business structure, although he said there were no immediate plans for this.

Coleman would not confirm which projects had contributed to the writedown, although it emerged this week that Bovis鈥� Manchester Civil Justice Centre project 鈥� due to finish in January 鈥� is behind schedule.

He revealed that more of the project team from Romford hospital, which was completed last October, were being transferred to the Manchester scheme. Senior Mark Buckle will join operations director Graham Hiley, who was moved across earlier this month.

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