Alfred McAlpine to take £27m financial hit

In a trading statement from Alfred McAlpine, issued on the Stock Exchange this morning (Thursday), the group reveals that it is taking a £27m financial hit, mainly as a result of issues arising from old contracts.

Alfred McAlpine has stunned the sector over the past three years as a result of its ability to log profit margins of 5% on construction projects in times when few were able to exceed the figure of 3% and many were finding it tough to even break out of the 1%-2% band.

The items within McAlpine’s £27m headache include:

• issues associated with the Ryan Utility Services acquisition in 2001.
  
• a worsening of out-turn losses on two of its construction contracts which commenced in 2000 and 2001.
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• £6m of re-structuring and re-organisation costs incurred during 2004.

Ian Grice, chief executive, said: “Over the last four years we have re-shaped our business.
Following the sale of our house-building operation to Wimpey in 2001 we have invested £190m in eight acquisitions and transformed Alfred McAlpine into a service company."