Sir Robert McAlpine returns to profit but pension deficit bites back
Sir Robert McAlpine has reported a £10.2 million pre-tax profit after suffering a combined operating loss of £128m in the previous two years though a deficit in its pension scheme has pushed the contractor into the red again.
Results posted at Companies House for McAlpine’s holding company, Newarthill, show the firm delivered an operating profit before exceptional items of £1.3m on a 9% rise in revenue to £870m.
Pre-tax profit was inflated to £10.2m after a contribution from joint ventures.
But this turned into a statutory pre-tax loss of £43m after the group took an exceptional write down on its pension scheme of £53m, connected with reassessing its pension liabilities.
Director Cullum McAlpine said the legacy projects that impacted profitability in 2014 and 2015 were all fully completed in 2016 and so will have no further impact on finances.
He said: “With our robust risk management and tendering procedures now embedded in the business, the profitability of the group continues to grow.
“During 2017, we continue to focus on our cultural change programme, which is designed to enhance our client focus and lean construction capabilities.”
He added that McAlpine now planned to expand the proportion of work obtained from frameworks and the public sector.
Non-executive chairman Gavin McAlpine said: “We are progressing our strategy to focus the business around growth, diversification and resilience. The business transformation programme that supports this strategy is also having a positive impact on the business and our people.
“Sir Robert McAlpine has a long and proud history of delivering world class construction and civil engineering projects for our clients; we have always championed innovation and have developed by adapting to changing market requirements. With legacy projects behind us, the business will continue to develop and grow, built on the strong foundation of engineering excellence that remains at the heart of the business.”