Gleeson records £20m loss, forecasts redundancies

Gleeson chief executive Paul Wallwork is not ruling out more redundancies after the housing and regeneration outfit crashed into the red.

Gleeson, which recently reduced its workforce to 330 after 75 job cuts, lost £20.3m in the 12 months to June 2008.

Wallwork said: “We will have to address [redundancies] again if the market declines.

“There is a lack of demand from retail customers due to lack of mortgage availability and things aren’t going to get much better over the next 12 months.

“There’s going to be a lot of pain for housebuilders and us as well and it’s all about keeping cash flowing.

“We’ve got to sit tight and take that pain, and take some costs out of the business. Then we’ll be better off.

“The market will come back but not like before and there should be more sustained and controlled growth.”

To take costs out, Gleeson is not proposing a final dividend for 2008.

The firm issued profit warnings in May and June this year after cutting jobs and merging its Bury and Sheffield offices. This, combined with land devaluations, produced a £17.4m write-down for 2008.

Gleeson took another £4.1m hit after resolving a disputed contract retained after selling the contracting business to its management.

Overall, Gleeson sold 439 homes at an average price of £149,000 in 2008 against 639 sales for an average price of £193,000 in 2007. Group turnover was £94.6m – down 51%.