COSTAIN MISSED out on turnover worth £70M in 1997 because its shares were suspended for most of the year, chief executive John Armitt said last week. But the contractor transformed its financial performance, substantially reducing pretax losses.
Costain's shares were suspended for 12 months from November 1996 as it put together a refinancing deal. Armitt said this stopped it from getting onto some tender lists and hampered efforts to return its engineering and construction division to profit.
Results published last week showed that the Costain group cut pretax losses from £62.3M in 1996 to just £7.4M last year. Turnover fell from £745M to £571M partly as a result of the sale of its US Mining division, which contributed £163.1M to turnover in 1996, but only £11.5M before its sale in 1997.
Engineering and construction made an operating loss of £800,000 compared to losses of £20.3M in 1996.
Armitt said that last year's losses resulted from carrying staff on the expectation of higher orders. This year he is stripping £8M of overheads in a drive to return to profit.