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27 April 2018
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MEARS CITES GRENFELL TRAGEDY AS A FACTOR IN DECLINE IN REVENUES

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Care division has been a highlight © iStock

21 March 2018 | Herpreet Kaur Grewal


Housing and maintenance provider Mears Group says it has seen a decline in housing revenues following the horrific fire at Grenfell Tower last year that claimed dozens of lives.

 

According to its financial results for the year ending 31 December 2017, its group revenue of £900.2 million (2016: £940.1m) was hit by both delays to the timing of planned workloads following the events at Grenfell Tower and a slow period in securing new contract revenues in housing, combined with the planned rationalisation of care contracts.

 

Group profit before tax and before amortisation of acquisition intangibles fell to £37.1m and housing operating margins reduced to 5.2 per cent.

 

It added that there was an “exceptional loss of £16.5m reported in discontinued activities relating to the full provision against performance guarantees in the legacy M&E division”.

 

The current bidding pipeline is in excess of £2 billion for 2018, says the firm’s statement, which is well in excess of normal bidding levels. The strategic evolution of Mears means greater access to opportunities previously out of its reach.

 

David Miles, chief executive officer at Mears, said: "Whilst 2017 proved to be a challenging year, we have made solid operational progress. The decline in housing revenues following the tragic events at Grenfell Tower has stabilised although there still remains some uncertainty as to the speed at which these revenues will recover.

 

“The performance of the care division has been a highlight, returning to profitability as planned following a period of restructuring, putting the care division on a stable footing. On a positive note, the current pipeline of opportunities for Mears has never been greater.”