Structural steel giant Severfield- Rowen is proposing a £47.9M rights issue in an attempt to reduce its debt after reporting losses in 2012.
The announcement came last week as it revealed underlying losses of £19.6M for the year to 31 December 2012 in its interim results. In 2011, comparative profits hit £10.1M.
The losses were primarily a consequence of an “unacceptable level of performance on a small number of contracts,” said executive chairman John Dodds. The interim results statement said that “contract execution issues” in the first six months of last year led to a reorganisation, but that problems had continued and culminated in a loss of £9.9M on the Leadenhall building in London.
Actual and potential cost overruns totalling £2.9M on another three projects were also identified.
Dodds is also acting as chief executive until a replacement is found for Tom Haughey, whose departure was triggered by the emergence of losses on the Leadenhall and other projects.