In a torrid year, Sir Robert McAlpine says its turnover fall 19% to £880.6m in the year to 31st October 2023, compared to £1,086.9m in 2022.
Operating loss was £109.9m, compared to a profit of £9.6m in 2022, as the cost of sales outstripped revenues coming in.
Chief financial officer Leighton More explains in the annual report: “The operating loss for the financial year is attributed to the difficult trading environment, which has had an adverse impact on the company’s assessment of end-of-life positions of price-based contracts which completed in 2023 or are due to complete in 2024. In addition to these contract losses, the company has incurred £7.8m in respect of the restructuring costs from implementing the recommendations of the strategic review which concluded in April 2023”
He added: “The company had four contracts where the financial position was reassessed in the year and write-downs made. The underlying causes were in the main due to the performance of our supply chain partners and the delivery of legacy projects in sectors which no longer fit our strategic direction. In addition, the proactive measures to reorganise and restructure the business following the strategic review also had a negative financial impact on the company.”
However, the family-owned construction contractor insists that 2024 is looking much better, with a healthy cash position, a robust pipeline of work and annual revenue heading back towards the £1bn mark. Results for the first six months of the current financial year show revenues of around £500m and a return of margins to industry norms, it says.
At the end of April 2024, the company reported £105m in cash and an order book totalling £1.4bn, up £271m since the start of the financial year last November.
In February 2024 McAlpine brought in a new chief executive, with Neil Martin, previously chief executive of Lendlease Europe, replacing Paul Hamer.
Of the 2023 results, new chief executive Neil Martin said: “We faced a challenging year in 2023, but our resilience and the support of our shareholders allowed us to weather the storm. We have already seen a positive shift in performance in the first half of 2024. Thanks to our focus on operational excellence and on targeting quality work-winning opportunities for long-term clients in our core sectors, we are playing to our strengths. As the company celebrates its 155th Anniversary this year, I have every confidence that the business is on the right path for long-term success.”
