Charge will be less than 拢25m reported in first half, says contractor
Galliford Try will take a further financial hit on the troubled Aberdeen road scheme, although the contractor is launching several claims over the job and expects 鈥減ractical completion鈥 of the project in the summer.
The contractor was one of three firms working on the road (pictured) in north east Scotland, along with Balfour Beatty and Carillion, which collapsed in January.
But long periods of bad weather have put the work on hold and the delays have cost the surviving firms tens of millions of pounds.
In a trading update, Galliford Try said further weather-related cost pressures meant it was likely to increase the exceptional charge in the current year.
It said the amount would depend upon progress made during the summer but it expected it to be lower than the 拢25m taken in the first half. 鈥淲e are continuing to discuss several significant claims,鈥 it added.
Last year the group reported a near 拢89m hit on two un-named jobs with the bulk being attributed to the Scottish road project, known as the Aberdeen Western Peripheral Route.
Earlier this year it launched a rights issue to raise 拢150m, largely to cover the cost of the delayed schemes.
Galliford Try said trading between the beginning of the year and the middle of May had seen its construction order book dip slightly to 拢3.3bn, down from last year鈥檚 拢3.5bn.
Its Linden Homes business had 拢1.2bn-worth of sales reserved, contracted or completed, level with last year. Around 拢904m was for the current financial year to 30 June 2018, down from 拢915m a year ago.
The group鈥檚 partnerships and regeneration operation had a contracting order book of 拢1.5bn, versus 拢980m in 2017.
Last year Galliford Try reported 拢2.8bn in turnover and pre-tax profit of 拢58.7m, after exceptionals.
It is expected to announce its 2018 results in September.
Balfour Beatty confirms summer completion
In a trading update ahead of its AGM this Thursday, Balfour Beatty said completion of the Aberdeen road 鈥渋s still expected this summer鈥 adding that 鈥渢here is no change to the 拢105-拢120m Balfour Beatty cash outflow guidance for 2018 provided at the full year 2017 results鈥.
It added that it was on course to meet industry standard margins in the second half of the year.
Chief executive Leo Quinn has told bosses at the firm鈥檚 UK construction business that margins should be 2%-3%, while its US construction business has been given a lower target of 1%-2%. Its support services business, which includes its utilities and transportation arms, has been given a target of 3%-5%.
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