Lindum profit falls 25% to £4.4m

Lindum Group has made a pre-tax profit of £4.4m, its second-best ever. It was built on what the group called “an excellent first-half performance and a solid second-half period”.

The 50-year-old East Midland company has published annual results that cover the 12 months to 30 November 2007.

Turnover was ahead at £87m, representing a rise of £8m on the previous year. Pre-tax profit was £1.5m down on the figure of £5.9m in 2006.

David Chambers, chairman, said: “Our business logic is to keep gearing low, retain and reinvest cash and profits in our balance sheet as best we can, investing wisely, which gives us a stable platform to expand in what we do well.”

Chambers listed Lindum’s operations as:

• Food processing – nationally
• Housing – regionally
• Medical centres – regionally
• Support services – locally
• Education – locally
• Joint ventures

Chambers added: “Our aspiration is not to be the biggest in construction but to be as good as we can be - and better than we say we will be.

“Each of our operating sectors made a profit in 2007 and a good contribution to the team’s performance.”

He said Lindum’s markets were due to grow at 2.1% in 2008.

The commercial property market suffered at the hands of the Chancellor when he announced the abolition of Industrial Building Allowances, said Chambers. “Then in November, to make matters worse, he made a further announcement that rates are to be charged on empty industrial properties,” he added.

The OFT’s three allegations against Lindum Construction of cover pricing go back to 2000 and related to projects in Yorkshire “a long way from our base” said Chambers.

“This practice is against company policy,” he said, conceding however that Lindum’s systems proved inadequate.

“We lost all three projects and we had no financial gain from any of them,” he added. “There was no loss to the clients. We believe that we will be fined for this offence, which was unintentional but we cannot comment at present on the amount of the fine.

“We hope that we continue to be a trusted, honest and straightforward company.”

Lindum had 490 employees of whom 249 were site-based. The cost of wages and salaries ran to £14m with another £290,000 by way of pension costs.

The group’s highest-paid director had £36,000 for his own pension pot plus another £281,000 as his salary.

Shareholders in Lindum took a dividend running to £840,000.