Laing O’Rourke suffers second year of losses9 January 2017 | By GCR Staff 0 Comments
Laing O’Rourke’s UK construction business suffered a pre-tax loss of £141m for the year to March 2016 on a turnover of £1.1bn. In its previous year’s results, the company reported a loss of £59m on revenue of £1bn.
The firm said work linked to its offsite prefabrication plant, specifically three Design for Manufacture and Assembly (DfMA) projects in the UK, contributed to the result after incurring exceptional costs of £26.6m.
According to Construction Manager magazine, the company said three schemes were “substantially redesigned to demonstrate the benefits of DfMA”, and added that they were won in 2013 in “a particularly aggressive price-driven market”.
“As issues were encountered using new construction methods and lessons have been learned, these unusual circumstances are unlikely to recur on new contracts,” the firm added.
In December, Laing announced that its overall group business had slumped to a £246m loss, partly as a result of a huge hospital PPP contract in Canada.
Founder Ray O’Rourke (pictured) sent a letter to clients and staff before Christmas to reassure them that the firm had taken steps to turn around its performance and was set to return to profit in the current financial year to March 2017.
The company has dismissed rumours that it is in takeover talks with a Chinese contractor.
Image: Founder and chairman Ray O’Rourke