The chief executive of Galliford Try has said contractors are winning work at a loss as a result of increasingly crowded tender lists

Greg Fitzgerald, speaking after the company issued a mixed trading update for the six months to 31 December 2008, said contractors were taking drastic action to boost cash flows and win clients.

He said: 鈥淚t鈥檚 got much tougher because more companies are looking for work in the public and regulated sectors. That means margins are depressed, and given some of the jobs we鈥檝e lost out on I鈥檇 say some are winning work at a loss.鈥�

But he said Galliford Try was well placed to win future work. On 31 December 2008, its order book was 拢1.7bn, 91% of which was in the public and regulated sectors.

Its housing business has suffered as a result of the economic downturn and figures were down on the same period in 2007 (see box).

The company has put more than 500 of its 4,200 employees on a four-day week, a move that has resulted in a 15% reduction in staff costs.

Asked whether the firm would have to cut more staff in the future, or put more on a four-day week, he said: 鈥淣ever say never. It depends on what happens during the spring selling season.鈥�

A 拢12m tax rebate from land writedowns left the company with 拢1m net cash at the end of the year, compared with debt of 拢47m in 2007.

Fitzgerald said Galliford Try鈥檚 relatively strong finances would change the pecking order in the housebuilding sector.

鈥淎t the moment we鈥檙e the eighth largest housebuilder in the country but we鈥檒l be much further up the scale and in the top five within two years.鈥�

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