Contractor adds it expects to recoup money in coming years as firm sees pre-tax losses widen in 2023 after collapse of M&E subcontractor

Willmott Dixon鈥檚 executive chairman has said the company expects to find out next year whether its action against several firms it accuses of being responsible for cladding problems on a huge scheme in London is successful or not.

The firm began action last year against five companies it claims are responsible for defects with the external wall system on the Tesco-owned project.

The 拢250m mixed-use scheme in south-east London, called Woolwich Central, is now costing the firm 拢48m to fix 鈥� up from last year鈥檚 figure of 拢44m.

Woolwich Central consists of an 84,000 sq ft Tesco superstore and seven residential tower blocks, covering more than 250 flats, the largest of which is nine storeys. It was completed at the start of 2014.

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Source: Shutterstock

Willmott Dixon said the cost to fix faulty cladding on the Woolwich Central scheme had risen to 拢48m

In a note accompanying its 2023 accounts, which have now been filed at Companies House, Rick Willmott said the recladding work was 鈥済oing very well but remains 15 months from completion鈥�.

He added: 鈥淎lmost parallel tracking the recladding work is our legal recourse action to recover costs on that scheme from the third parties responsible. If this matter reaches the now confirmed court hearing, we should receive judgement around this time next year.鈥�

In its 2022 accounts, Willmott pointed the finger at firms in several sectors, including designers, fire engineers and insurers, who, he said, 鈥渟o far have not faced up to their responsibilities or obligations鈥� regarding the cost of recladding work that is now required in order to comply with building safety legislation.

The firm has previously said its bill to fix legacy cladding issues across several schemes was 拢62m but in its 2023 accounts, it said it had recovered 拢6.6m of this and that it expected more successful claims in the future. 鈥淲ith active mediation and legal processes continuing, we still expect substantially more third party recoveries against these provisions in future years.鈥�

Meanwhile, the firm said pre-tax losses at the business widened from 拢8.7m to 拢14.4m last year as the firm counted the cost of a bust M&E contractor which was working on two of its jobs.

It said the collapse of the unnamed firm hit Willmott Dixon for 拢12.8m which, together with the increased cost of work at the Tesco scheme and associated legal fees, took exceptional items to more than 拢17m 鈥� although this was mitigated by a successful 拢10m insurance claim, meaning overall exceptional items stood at 拢7.1m.

It also added that it had been forced to add 拢7.5m to its 2022 accounts as an exceptional item after an insurance claim for that amount 鈥渨as no longer considered virtually certain as at 31 December 2022鈥�.

Its biggest business, construction, saw income stay at just over the 拢1bn mark last year while revenue from its interiors was also flat at 拢130m.

It said cash in hand and at the bank remained at 拢115m.

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