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Grontmij Europe spares UK operation from job cuts

Grontmij’s UK operation will avoid cuts in a restructuring operation announced by its parent company this week.

John Chubb

Chubb: UK operation is trading strongly

Headcount in some parts of the business is set to grow by as much as 10% this year.

The Grontmij group announced the restructuring last week on Wednesday as the Dutch firm posted worse than expected annual results.

But UK managing director John Chubb told NCE that his operation would escape cuts.

“We’re absolutely trading well and going in the right direction,” said Chubb. “We went through a quite significant cost restructuring back in 2012 and the UK is now a very solid business. So there are no significant cost reductions planned for the UK.”

The firm’s UK operation reported an operating profit for the year ending 31 December 2013 of £2.1M, up 40% on £1.4M in 2012.

This is in marked contrast to group-level results where the firm made a net loss of £12.2M on total revenue of £627M. This was down on the £649M the year before.

An organic decline of 2.6% was mainly driven by France, where revenues fell by 10.4%, and the Netherlands where they
fell 5.4%.

Chubb said the results marked a turnaround for the UK business, which lost money in 2011.

Chubb said he hoped for a further boost this year, with the firm currently bidding for water sector work in the Asset Management Plan 6 period starting in April 2015.

It is also bidding for a place on the Highways Agency’s new design framework.

He added that the firm was now recruiting again, with some areas of the UK business looking to boost numbers by as much as 10% this year.

This is not the case across the rest of the business, with the firm announcing that “decisive steps” including further restructuring and refinancing will be taken this year.

It will also review the strategy for the French engineering businesses and assess strategic options for the French activities. Non-core operations in the Netherlands will be discontinued or sold.

The firm said it would continue to invest in the five long term attractive growth segments in which it claims market leadership.

These are water, energy, highways, sustainable buildings and light rail.

The UK operation works across all these sectors except light rail and Chubb said he no plans to change this approach.

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