Lancashire-based contractor Eric Wright has revealed its construction division was hit by an “underperforming contract” and a reduction in turnover for the year ended 31 December 2018.
Construction turnover fell from £79.4m in 2017 to £74.6m, and the firm reported that its “underperforming contract” suffered from design-related issues that resulted in the administration of two if its supply chain partners, causing the business “significant cost overruns”.
Despite “disappointing losses”, the contractor said its client base continued to expand.
The Eric Wright Group, which also includes a housebuilding and development arm, and an in-house infrastructure firm, announced that its overall turnover increased by £11m despite the construction division’s losses.
Overall revnue rose from £159.1m in 2017 to £170.4m. Pre-tax profit also increased by £2.8m.
Eric Wright Group attributed the strengthened balance sheets to its housebuilder Applethwaite, which had a turnover of £13.5m this year, up from £8.1m in 2017.
The business’ finance director Gill Chadwick said that a strong balance sheet leaves the group “well-placed” in the market with the capacity for further expansion in the future.
Ms Chadwick said that “a key strategic objective” continues to be investment in the group’s portfolio of properties.
The group’s infrastructure arm, Eric Wright Civil Engineering, also experienced growth, with turnover increasing from £14.2m in 2017 to £21.7m this year due to winning more places on frameworks.
The infrastructure arm of the group also reported an increase in its average contract size.
Eric Wright managing director Jeremy Hartley (pictured) said that the group has set up “realistic growth targets” for 2020 across all its businesses.
He said: “The wider outlook has some fundamental uncertainties, but the business is well-placed to mitigate the impact of these through careful management of risk and focus on core principles.”
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