GALLIFORD Try has announced it is undertaking a review of its construction business.
The contractor outlined its plans in an operational update, which stated that the review would include an assessment of operational progress and contract position throughout its construction arm and reduce the size of the business.
The Galliford Try board anticipates that this review will reduce the group’s full-year post-exceptional profit by £30m-40m, reflecting a reassessment of positions in legacy and some current contracts and the effect of some recent adverse settlements, as well as the costs of the restructure.
Galliford Try stated that the single largest element relates to the Queensferry Crossing joint venture, which has recently increased its estimated final costs on the project. With regard to the claim in respect of the completed Aberdeen Western Peripheral Route, and the previously disclosed £38m work in progress balance in respect of three contracts for a single client, its position is unchanged.
A Galliford Try spokesperson commented, “Galliford Try has announced that it is undertaking a review of its construction business with a view to maximising its profitability. The review will realign the business to focus on its key strengths in markets and sectors with sustainable prospects for profitability and growth, where we have a track record of success.
“The review includes an assessment of operational progress and contract positions throughout the construction business. The Board anticipates that this review will result in reduced profitability in the current year reflecting a reassessment of positions in legacy and some current contracts.
“The board believes that construction has strong fundamentals in the majority of the business and remains in a good position as we conclude the review and move forward as a group.”