Leicester City causes pre-tax loss for Birse

Birse has reported a first half pre-tax loss of £3.84m against a profit of £1.1m a year ago, after an exceptional operating loss of £5.5m relating to Leicester City.

Pre-tax profit, before the exceptional operating item, increased to £1.7m (2001: £1.2m), which Birse said reflects the "underlying progress the group continues to make".

The £5.5m exceptional item relates to the write-off of all amounts owed to Birse Construction by the Leicester City Group of companies following the appointment of an administrator to the football club.

Turnover for the six months to 31 October rose to £248m (2001: £246m), with the group reported a solid construction order book (excluding sports stadia) of £356m.

The company's construction activities reported a reduced operating loss of £379,000 (£412,000), while for the third year in succession Plant Hire improved its results, increasing operating profit by almost a third to £1.6m (2001: £1.2m).

Birse expects to incur further losses in its building business in the second half and is uncertain about the short-term performance of the busines.

Nevertheless, the group's statement reads: "Birse is in a stronger trading position than in previous years. The Leicester City bad debt is regrettable. However, with all our main markets expected to remain steady we believe that further progress in the underlying performance of the business will continue."