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Laing O鈥橰ourke鈥檚 profit across its European operations nearly halved last year to 拢36m after the firm wrote off 拢23m from the value of land and property assets across its operations.

However, the firm鈥檚 Australian business, which includes South-east Asia and New Zealand, bounced back into the black after two years of losses, reporting profit of 拢25m, helping the overall group to more than double pre-tax profit compared to last year.

In its results for the year to 31 March, published today (attached right), the UK鈥檚 largest private contractor reported total revenue, including share of joint ventures, of 拢1.95bn in its European hub, up 11% from 拢1.75bn the previous year.

But operating profit fell 46% to 拢36m (2012: 拢66.6m) in the European business, which includes the Middle East and Canada, after the deduction of 拢15.4m in exceptional items.

In the notes to the accounts the firm said the exceptional items across the group included a 拢23.3m write down on the value of its residential and mixed use development assets, following a review. The firm said the valuations of the assets had 鈥渋ncorporated forecast selling prices based on recent market conditions鈥�.

The firm added: 鈥淚n certain instances the directors assumed appropriate planning consents will be granted 鈥� As a result of the review, the Group recognised exceptional impairments of 拢23.3m.鈥�

However, the firm鈥檚 Australian business bounced back from losses in 2011 and 2012, with an operating profit of 拢24.5m, up from a loss of 拢34.5m the previous year.

Total revenue in the Australian business was up 16% to 拢1.6bn (2012: 拢1.38bn).

The performance of the Australian business helped the group to more than double profit, with pre-tax profit of 拢57m up from 拢23.4m the previous year.

The group reported an operating profit of 拢59m, up from 拢9.4m in 2012.

Overall total group revenue edged up from 拢3.54bn last year to 拢3.57bn.

The number of staff across the group also rose over the period from 14,858 last year to 15,351.

However this is still a fall of 57% on the overall headcount of 35,753 in 2009.

The group鈥檚 order book remained flat at 拢8.2bn, of which 拢5.6bn is in the European business and 拢2.6bn is in the Australian business.

Writing the accounts, Laing O鈥橰ourke chief executive Anna Stewart said the firm was 鈥渄elighted鈥� about the 鈥渞ecovery enjoyed by our Australian business this year鈥�.

She said: 鈥淲e expect Australia to be a rich market of opportunity for the Group over the next few years and believe that our offering, which reduces the need for onsite workers, could be particularly attractive for the remote, fly-in,fly-out locations where many of these projects are based.鈥�

She added: 鈥淭he construction sector in the UK continues to decline in terms of market volume and, although there has been a shift from building to infrastructure, spend overall is down.

鈥淲e do not expect this trend to change materially and foresee few signs of significant stimulus prior to the 2015 general election.

鈥淲e will continue to reinforce our prudent practices of recent years while focusing on offering innovative engineering solutions as the best opportunity for an acceptable return at an affordable sales price for our clients.鈥�

鈥淲e are comfortable working in the Middle East at our current scale but will only grow volume if we see a relaxation in the contracting and payment practices in some of the more traditional territories. We can see the obvious demand from fixed-date event commitments, as well as the international supply chain capability which has swarmed into the region.

鈥淲e have been following a focused approach in Canada which generated early profitability for that business. We will selectively consider opportunities to work with existing customers in new territories, should the combination provide a sensible proposition with low barriers to entry.

鈥淎dditionally, we will exit businesses if the dynamics are such that we cannot operate them profitably. To this end, we disposed of our stone quarrying operations in Germany during the year.鈥�