Amec runs up a £5m loss

Amec has unveiled its latest interim results for the global group showing a huge turnover of £2.2bn, but the end result was a pre-tax loss of £5m.
Chief executive Sir Peter Mason said: "Our exit from low-margin, high-risk construction reinforces our focus on higher value services. We see substantial opportunities to deliver value for shareholders by leveraging our market position.
"Strategic relationships in markets with high barriers to entry are our future," Mason said.
Exceptional costs ran to £42m. Without the need to sort out various financial muddles, Amec would have made a pre-tax profit of £38m, representing an operating margin of 2.6%.
Amec said that wind energy is expected to develop as a key sector for the group. The Scottish Land Court's decision to rule in favour of Amec's Edinbane wind farm proposal on Skye means that construction can get under way in 2005. Amec has a portfolio of wind farms that totals more than 2,000MW and represents 16% of the UK government's renewable target for 2010.
Further investments over the next five years are on the cards and are expected to produce 20% annual returns.
In March, the Amec Fluor joint venture won a leading role in the reconstruction of Iraq, winning contracts to restore power generation and water infrastructure. The expected value of projects under way runs to £300m.
"Projects are proceeding to plan and major milestones are being achieved," Mason said.
Amec had an average weekly net debt of £405m, a £75m increase on 2003. This reflects the cost of acquisitions and planned reduction in Amec's higher-risk, low-margin capital project activities.