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Kier reveals £245m loss as chair quits
Troubled contractor Kier has revealed a £245m annual loss and announced its chair is quitting after two years in the job.
The publicly listed group, which work includes maintenance contracts for housing associations, reported today a statutory pre-tax loss of £245m in the year to 30 June 2019, compared with profits of £106m the previous year. It booked £341m of charges, primarily relating to restructuring efforts and “significant loss-making contracts”.
Its revenue fell 3% to £4.12bn.
Chief executive Andrew Davies, who was chief executive in waiting at Carillion before it went bust in January 2018, is carrying out a strategic review as part of an effort to stabilise the company.
He admitted that it had been a “difficult year”.
His turnaround plans including selling off Kier’s housebuilding arm. The sale process is “progressing well”, the firm said today, without offering further detail.
Kier is also looking to offload its facilities management business and environmental services arms to concentrate on construction and civil engineering.
Mr Davies said: “Kier experienced a difficult year, resulting in a disappointing financial performance. However, we are building firm foundations for the future: we have a new management team in place, we have defined our strategic priorities and we are taking decisive actions to deliver them.”
Looking ahead, Kier also warned that revenues are unlikely to rise due to Brexit-related uncertainty. “Brexit has the potential to disrupt the group’s operations, particularly in relation to materials, people and the supply chain,” the group added.
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Kier also announced that Philip Cox, its chair, will step down once a replacement has been found.
He has overseen a management overhaul at the firm, which has included a raft of executives leave, including chief executive Haydn Mursell.
In its housing maintenance arm, Kier said its volumes had been hit by local authorities taking work in house.
However the group reported an “increased demand” for fire safety assessment jobs in the wake of the Grenfell Tower tragedy.
Kier has a place on Hyde’s £50m fire safety framework. It also has a three-year, £8m contract with Gentoo and a £5.7m contract with Hammersmith & Fulham Council to deliver fire safety repairs.
Kier’s share price was down around 4% mid-morning at 126p.
