好色先生TV

Kier will rationalise its extensive network of regional offices, with different parts of the business brought under one roof, in a bid to cut costs amid the ongoing contraction in the construction industry.

Speaking to 好色先生TV following the announcement of the firm鈥檚 half-year results last week, Kier chief executive Paul Sheffield (pictured) said the restructure, which is expected to cost the firm 拢12m this year, would mean the business would consolidate its regional offices across the UK.

In its results for the six months to 31 December 2012, Kier reported interim profit of 拢20.9m, down by 35% on the 拢32.3m recorded in the same period in 2011, on revenue of 拢976m, which was down by 6.8%.

Kier鈥檚 construction business had a 2.1% operating margin over the period, down on the 2.5% recorded at the same point last year, with revenue also down by more than 10% to 拢627m.

Operating profit in the construction business for the period stood at 拢13.5m, down from 拢17.8m over the same period last year.

Sheffield said the results showed a 鈥渟olid鈥� performance in a 鈥渄ifficult environment鈥� and that the firm was restructuring to reflect the 鈥渟cale of future opportunities鈥�.

Kier鈥檚 construction business operates across eight regions, with 28 offices, while the services business comprises 33 offices. A further seven offices serve the firm鈥檚 infrastructure and engineering businesses (see map).

Sheffield said the restructure would retain the existing structure of eight regions, but would involve the consolidation of the firm鈥檚 鈥渧ery extensive network of offices鈥�.

He said: 鈥淭here is a slightly more efficient way to run the business that we believe will not weaken our regional presence.

鈥淲e won鈥檛 be reducing the regional structure. But we鈥檝e obviously also got a services division and in some parts of the country we might have a services office 15 miles away from a construction division office and actually by putting them both into one office we will get savings and efficiencies.

鈥淪o in terms of the regional network of construction companies we鈥檙e not going to move away from the eight that we currently have but there will be some rationalisation of some of the offices.鈥�

Sheffield said the restructure, which would be complete by the end of the financial year, would inevitably involve redundancies, but would not be drawn on the number of job losses.

He said the shake-up was aimed at making Kier 鈥渁 leaner and more efficient business鈥�, but declined to give a figure on the annualised savings the firm was targeting.

He said the 拢4.4m in costs already incurred in the first half of the year through the restructure was in part because of the disposal of 鈥渢wo peripheral business units鈥�, including 拢2.1m write-off related to the sale of the firm鈥檚 scaffolding business as well as a reduction in head count. He declined to give a further breakdown of the costs.

He said the remaining costs of the restructure, expected to amount to around 拢7.6m, would be incurred through redundancies and the property costs as a result of office closures.

He added: 鈥淲e are having to approach this as every business is: the building market in the UK is very tough, it鈥檚 been difficult for a couple of years and it鈥檚 going to be very tough for the next two years.鈥�